We’re in the middle of a couple negotiations between our customers and their top sales candidate selection.  The companies are smaller and these positions are fairly important within the department so they are not “slotted” pay ranges that are more common in larger companies.  Both negotiations have similar topics (salary and commission plans are always prevalent in sales negotiations) but different approaches by the candidates.

Call it serendipity, but I came across a timely SalesHQ article titled How To Structure A Negotiation.  The author, Jonathan Farrington, provides 3 important steps for any negotiation whether it be for a potential hire or a potential customer:

The recommended structure for negotiations is:

1. Establish the issues being negotiated

2. Gather information

3. Build a solution

Here are a couple of excellent points from the article (my editing):

Stage 1. Establish The Issues

Many negotiators make the mistake of negotiating too quickly whereas skilled negotiators spend 20% more of their time asking questions and looking for alternatives.

Seasoned negotiators will often bring up an issue at the end of the negotiation, when you are vulnerable and likely to agree to a one sided (Lose-Win) concession, in order to conclude the deal. You can legislate for this ploy by asking the other side for their . “shopping list” before beginning the negotiation and refuse to accept any last minute additions to the list.

Stage 2. Gather Information

You need to decide, before the negotiation, how much you are willing to share information and what your own information requirements are. This will set the climate for the negotiation and will determine the amount of trust that exists between both parties. Skilled negotiators are able to ask a range of open, closed and follow up questions and are able to listen effectively. They also wait until they have all their information requirements, before making concessions.

Stage 3. Build A Solution

Typically, there will then be a process of bargaining, concessions will be traded and movement take place, until, hopefully, agreement is reached. Concessions should not be given away for free and you should be wary about conceding on issues for which you are not prepared.

One of our sales candidates added a new issue after receiving the offer.  This is a good move on his part, but it comes with some risk.  The negotiation will proceed at a measured level while we will see how he responds to the counter.  I am not as measured in these instances - I prefer to call the bluff which has left me in a pickle more times than not.  That is why I find Mr. Farrington’s suggestions valuable.

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We here that phrase often - must have experience selling to the (insert executive/C level/CEO here).  But how many positions actually sell to this level?  What do CEO’s actually purchase for their company?

Financial planners sell to the C level.  High-end insurance salespeople sell to the C level.  However, most positions do not sell at that level.

One value for a salesperson is the ability to enter at that level and then be sent down to the correct mid-level manager with a referral from the C level contact.

Yet even that “kicked down” ability is overstated.  The real value is being able to discover the decision process within the company.  For many products and services, this process is not found in the corner office.  The flatter the organizational hierarchy, the more difficult it is to find the decision maker.  Odds are it is more than one person.

The salesperson who can approach a prospective company, find all of the decision makers and then sell each of them on his or her solution…well, that is truly a skilled salesperson for today’s corporate world.  This salesperson may not have experience selling to the executive level, but they have the ability to sell to the right level to close deals.

And you may miss out on them if you think your sale goes through one C-level person.

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This video from Selling Power discusses a unique look at the traditional sales funnel.  The author in the video states that the sales funnel has to be thrown out and redesigned based on the prospect’s process.  The 4 minute video is an excellent discussion on this topic:

If you have trouble with the video, here is the link to watch it on the Selling Power website.

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Selling Power offers a short, but excellent article that provides 5 subtle ways to build credibility.  We often talk about establishing rapport with prospects and then building credibility.  This is sales 101, but it is surprisingly sparse in sales situations (emphasis mine):

Of the five elements which are essential to building genuine trust (character, competence, confidence, credibility, and congruence), a Persuasion Institute poll found 44 percent of respondents said credibility was most important – yet it was established only 11.4 percent of the time.

So here are the author’s suggestions:

1.  
   1. Admit weakness. Nothing’s perfect. Prospects know your company and your product are weak in some areas. You boost your credibility when you admit to those weaknesses rather than trying to sweep them under the table. Even better: turn a perceived weakness into a desired benefit. For instance, if your software doesn’t have all the bells and whistles of a competing product, point it out. Then point out how the simplicity of your product boosts usage and data entry accuracy.
   2. Borrow credibility. When your prospect doesn’t know you or you believe your credibility with them is low, borrow the credibility of another to boost your own. Ask yourself: who could endorse or recommend you? Who has credibility with your prospect and would be willing to call and introduce you? What relevant testimonials can you share that would boost your credibility?
   3. Stay positive. When you bad-mouth the competition, your credibility heads south faster than you can say “no sale.” It’s just like your mom always told you: talking badly about someone else does not make you look better. In fact, it has the opposite effect. Sure, there are some instances where a prospect legitimately needs to be warned about the competition; in these cases, provide ways for the prospect to discover the problem for themselves, says Mortensen.
   4. Subtly reveal qualifications. If you have expertise, education, experience, or other qualifications that make you an expert in an area, find ways to reveal it without coming across as a braggart or conveying a sense of superiority to your prospect. When audiences accept you as an expert, says Mortensen, you’ll have their undivided attention.
   5. Stay calm. Have you ever seen a highly successful CEO or lawyer rushed and flustered? No way. They are always composed, even in the middle of a crisis. Likewise, sales professionals who stay calm and poised come across as highly competent and credible. So no matter how flustered you feel, never let anyone see it.

I particularly appreciate that last point.  There is something impressive about a businessperson who remains calm and measured even during a stressful situation.

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That is how long you have to hook a person on a cold voicemail message according to this article on Salesopedia (my bold):

6 Interesting Sales Prospecting Statistics

1.  In a recent survey 95% of salespeople said they can sell - they just need to get in front of more prospects.
2.  Effective prospecting blends both marketing & selling.
3.  Most salespeople HATE to prospect.
4.  The best prospectors often close more business than the best salespeople.
5.  Nearly 60% of high performing prospectors consider the phone ESSENTIAL to their prospecting success.
6.  Decision makers listen to only 9 seconds of a “cold” voicemail before deciding to press delete?

Good points all of them.  If you only have 9 sec., does it make sense to spend it stating your name and contact information?  My thought is that it makes more sense to take an approach that buys you another 9 seconds.  Whatever your approach, know that your window is smaller than you may have expected.

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This tip comes from the Selling Power archives:

Never ask a question without first explaining why you’re asking.

Nirenberg says, “Just asking a question puts the listener on the spot. However, if you let him know why you’re asking, it makes him a partner,” Nirenberg goes on to explain, “People with sales backgrounds often avoid asking questions because they think that the talker controls the conversation. That’s not true because the listener can always tune you out. In fact, you’d be surprised how often you’re talking to yourself during a sales call.”

That is a good tip.  Asking good qualifying questions is crucial for successful selling.  However, most people have experienced a salesperson who takes this approach to an obnoxious extreme.  I have seen them rattle off question after question like a machine gun.  You could just see the prospect shutting down.

The key is to soften the questions before asking them.

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Salesopedia.com offers a good article this week on a timely topic - How to Shorten Your Sales Cycle.  The author cuts to the quick on an issue we encounter frequently:

To begin with, many sales people just don’t know how long their sales cycle is, we ask and we hear things like “depends” (sometime it fits), “it changes” (it always seems longer during Daylight Savings Time), and the all time favorite, “well you know it’s different in our business”. Well it’s not really.

Underlying this is the fact that many reps and organizations do not know what their sale looks like, they have not deconstructing their sale, identified the basic building blocks to identify and truly understand what it should look like and when efficiencies can be had. One facet of this process is covered in “Working Backwards From Your Goals”

True.  We see this often when we start with a new customer by profiling their sale.  It is amazing how few salespeople can define their sales cycle.  Clearly it varies to some degree, but I always tell them their guess is better than mine.  So how do you fix it?  Simple:

While there are a number of ways to affect the length of the sales cycle, by far the easiest to implement with the highest rate of return, no technology required, is to always secure a next step with your prospects.

This approach really is simple - it just takes a slight bit more effort to accomplish.  Many salespeople end a call or meeting with some form of “I’ll call you next week.”  That’s it.  No clear next step, no future commitment, no clarity.  The better approach is to ask this way, “I’ll call you next week.  One thing, what topics should I be prepared to discuss?”  That short question will do more to qualify an early-stage prospect than any other a salesperson could ask at that point.  Yet, most do not use it.

The author sums up this approach nicely:

In most instances, a next step does not always have to be quantum leaps, just remember that even a small movement forward gets you that much closer to close. But if you don’t secure a next step, have you advanced at all?

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The Northwest-Delta airlines merger is the talk of this town as you might expect.  There has been much posturing up here as people and politicians realize that Northwest will probably leave this town as Atlanta becomes the new company’s headquarters.

I was reading an article on the merger in our local St. Paul Pioneer Press when I came across this quote (my highlighting):

As for the covenants Northwest signed with the state in 1991 on maintaining a certain number of jobs, the airport hub and Northwest’s Eagan headquarters, Anderson said “we think we can get to the spirit of the original covenants that were struck.”

That is a fat-worded, or fuzzy-worded, phrase of the highest order.  Somehow I don’t think they are thoroughly committed to the original covenants.

If this was a sales qualifying situation, the sales rep would have to ask Anderson what he means by the phrase “get to the spirit.”

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Selling has always been about relationships, but it is becoming more significant in today’s world.  According to a recent study referenced in this Selling Power.com article - The Relationship Imperative - product superiority is not as big a driver in customers’ decision-making process.

“Product superiority used to be a big advantage for companies,” says Jim Dickie, partner at CSO Insights. “But collapsing product lifecycles is changing that. If a competitor doesn’t have a feature or function today, they can catch up a lot faster than they could in the past.” The result: product superiority has dropped down to the number three reason companies win deals with just 35 percent of companies citing it versus 56 percent who say relationships drive their wins.

Isn’t that notable?  “Collapsing product lifecycles” is really behind this shift.  I just read an article about 5 new cell phones coming out to compete with the iPhone.  They are all touchscreen phones with many similar features.  Maybe we are trading imitation for innovation?  Whatever the reason, relationships drive sales.

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This topic comes up often in sales discussions - when should I go for the close?  Or hiring managers often ask, “Is he a closer?”  Or articles state that most salespeople fail because they don’t ask for the order (i.e. close).

So what are we to make of this topic?  Selling Power offers a bit of an enigmatic article titled Knowing When to Close.  The responses are from a sales meeting from 1929 (I don’t know why).  The pull quote:

A still smaller minority expressed the opinion which I believe to be the correct one, that while there is undoubtedly one moment that is the best time to close any sale, at the same time there are many moments almost as good, so that the salesman will have many other good chances to close, even if he does pass the one best moment.

I agree with that, but I have often stated here that the focus needs to be on qualifying instead of closing.  Sales don’t close due to poor, or incomplete, qualifying.  A salesperson who does not ask for the business will have problems, but not nearly as many as a salesperson who asks for the business without knowing if the deal is qualified.  This point is critical to sales success.

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