By CommenceCRM

Sales Question and Answer #15 – Betrayed

This is a Customer Management article from guest poster Dave Kahle, author and leading sales educator.  Follow Dave’s latest Tweets at @davekahle.

Do not fear risk Q.  I worked on a large bid for a company with which I had relationships in the past. I knew that we could do a great job for them but I also knew the buyer in charge of the project worked from fear and comfort and it would be a big change for him to turn over about 600K of business to us. I asked up front if we were to put something “special” together for him would we be given an opportunity or just used as a negotiating piece for the current vendor (my old company). I did not get a straight answer, and proceeded to put together an A+ presentation. We found out our program showed an immediate 15-18% reduction in cost. All of our information was given back to the current vendor and they eventually matched our proposal.

My question is: I am considering going over the local and national buyers head laying out the facts to a VP or CEO, not in spite, but to say if we did this on this opportunity what else could we uncover that may be being missed. Also should I have refused to move forward with the bid unless I received some kind of commitment guaranteeing me the business if I were to meet some specified requirement?

A.   This is one of the most difficult issues a B2B sales person faces.   It represents one of the true “lows” of field sales.  We often talk about the “highs” of gaining a big deal, but rarely the “lows” that come with being used and abused.  Unfortunately, almost every sales person has one of these kinds of stories to tell. I can still remember a very similar situation in my experience.  It was a several million dollar piece of business, involving a buying group, and I was left in the same situation you are in – a lot of work done to create a great proposal, and someone else, who had invested nothing, got the business on the basis of broken promises and a few cents difference.  I was used and abused, and to this day, I have bad feelings about it.

Just as an aside, if you were the competitive sales person, you would be bragging about your relationship, and how you got the “last look” and the ability to meet some competitor’s best efforts.  I’ve always had a bit of distaste for that approach, even though a number of sales people consider it desirable.

I’m not sure I have the 100% fool-proof solution to this, but I do have some thoughts to share.

First, let me respond to your specific question:  Should you go over the buyer’s head to a VP or CEO?

I don’t think so.  No matter how careful you are, you are going to look like you are bitter and tattling on the buyer.  You won’t look good, and that will come back to bite you some time in the future.

Now, let’s try to learn from this.  I see two questions:

a.  What to do in this account?

b.  How to prevent this from happening again?

1.  What to do in this account?

If you can pull it off, you may want to find a way to share your view of things with the buyer.  Does he even know that he did something that most people consider is immoral?  He may think nothing of it.  If you can have that conversation with him, it may make him feel a bit obligated to you in the future.

Chances are, though, that is not a conversation you will be able to have with this buyer.  I honestly think, if it were me, I’d pull back and wait for a change in buyers before I put any significant investment of time or energy into the account.

Those of you who have been through my system of rating accounts by potential will recognize that this account is low in “partnerability.”  Hopefully, there are more responsive fish to fry elsewhere.

2.  How to prevent this from happening again?

I’m going to share some thinking with you that you will probably have never heard before.  You don’t want to have this happen to you again.  To prevent this in the future, think about “risk.”

“Risk,” in this particular case, is the fear in the mind of the customer of what might happen to him if he makes a mistake in awarding the business to someone he doesn’t know well.

One of the core reasons why you didn’t get the business is that, in the customer’s point of view, you represented a greater risk than their current vendor.  (By the way, “risk” is one of the biggest issues in the buying/selling interaction.  Check out my article on it, and consider one of my one hour seminars on it.)

This deal sounds like a big one, relatively speaking.  The mistake that you may have made is to pursue a “big deal” in an account where you were viewed as the higher risk choice.  This rarely ends up well, and more times than not, produces a result similar to the one you experienced.  The other company, because of their past relationship, is always seen as lower risk than you.  Since the customer is fearful of the risk, he’s going to find a way to do business with the lower risk choice.

Strategically, the way you make your option look like less risk is to do small pieces of business first, so that you establish some history of performance.  Then, when the big deal comes up, you are operating from a “less risk” perspective.  Alternatively, if you could have broken the $600K deal up into four or five smaller pieces, that could be executed and implemented sequentially, one-at-a-time, you would have had a better chance.  Smaller deals are less risk.

I would generally NOT put much time and effort into pursuing “big deals” with accounts that had little previous experience with my company.  I know they are tempting, but they almost always turn out like your experience — a waste of your time and energy.  You get used and abused.

So, pick your battles carefully.  Don’t put a lot of time and effort into “big deals” unless you have a history with the account, and are seen as a “low risk” provider.  Your time and effort are valuable commodities.  Don’t waste them on opportunities and customers that aren’t worth it.

Hope this helps.

Copyright MMX by Dave Kahle
All Rights Reserved.

Image “Do not fear risk” by Leland Francisco on Flickr under Creative Commons license.