I had an revealing discussion with one of our client’s this morning. This gentleman is the President of his company and we are running our process for a second sales position (selected 1 salesperson already). The conversation centered on the problems he had with a previous salesperson who has since been let go.
This salesperson was completely reactive – he possessed no selling system whatsoever. His process was to take a call and fish for a request for proposal (RFP). He would respond to the RFP and hopefully get the business. Sad, but that was his process.
The President was hesitant to let this sales guy go because he thought their RFP work would decrease. They fired the guy and the RFP rate has continued unabated.
I asked the President what is the pattern for winning the RFP process. His response – “We get the business when we are the lowest price.” He followed that up by stating that it is obvious these companies do not see the value that the company brings to the marketplace. This statement is absolutely correct. The previous salesperson could not sell their unique value.
Our client has a unique finishing process that has tremendous advantages over the competing processes in the market. Unfortunately, it is a rather unknown process and it costs more “per piece” to use it. The long-term cost of the process blows away the competition. But here is the rub – if a salesperson gets caught up in the RFP price matrix, they are toast.
When someone from a large company is making a purchasing decision and they do not understand your value, they will always revert to a price decision. Their reasoning is simple, it is highly unlikely that they will be fired for choosing a lower-priced option that fails. They can simply state they chose the best solution according to their price matrix.
Pathetic. And a real issue for salespeople if they are asked to sell a product or service that is not the low-priced option in the market. The difficulty is that value is not solely determined by price. Price is simply a component of the value. When companies cannot determine the unique offering you bring to the market, they simply drop your solution into an Excel spreadsheet.