NEW Sales teams increasingly need to concentrate on the core challenge of overcoming price competition. The challenge is to create and sell value. This programme will help you achieve just that.
Sales teams increasingly need to concentrate on the core challenge of overcoming price competition. The challenge is to create and sell value: above all, to better negotiate true financial rewards for the value we bring, in an era where it seems power has shifted to the purchaser. A perfect storm of elements has driven down margins and threatened profitability. Are you equipped to deal with this?
The objectives that will be achieved during this workshop are:
1. Understanding the customer landscape
Historically, there was a core of customers who were willing to reward better-than-average service/product by paying a little more. We think of these as B+ customers. The customer landscape is now very different. Some B+ customers have become Transactional Price (Tx) customers. Their focus is price. For these customers, good enough is good enough.
2. Strategies of stupidity
Buyers are not stupid people. They are well trained and, in recent years, have become more and more powerful in the decision making process as our customers. However, they do adopt the appearance of someone who doesn’t understand value, can’t see why they should pay for it, or won’t believe the numbers even when we present them in detail.
We need to break this cycle and get back control of the sales conversation to enable us to demonstrate our value and get paid for it.
3. Changing attitudes and mind-set
Sometimes we can know too much. And, sometimes we can talk too much. We get so busy telling customers all the good stuff we have and great things we can do that we forget to listen to their needs. We need to get better at getting out from behind our brochures and our presentations and getting in deep with our customers – findings ways to better understand their business.
4. Engaging the customer
A meeting with a strategic value customer or a customer we are trying to get to be strategic is more than an opportunity to make our standard presentation about our goods or services. It’s a chance to talk about them and what we can do for them. It shouldn’t be a summary of things we’ve done for other people or our locations, or our technology – not at first anyway. We need to get them interested. Show we care about them and that they should care about us.
5. Creating a value profile
Customers need very little information to arrive at an opinion on our value – good or bad. Every day they are assaulted by ‘best value’ offers – ‘value specials’ – ‘extra value’. All of these mean one thing – cheapest price – more of the product for less money. They define value as lowest price. The word value has become de-valued.
Great businesses are seen by their customer as delivering something more than the simple product and have built a customer mind-set that makes value something to be paid for – something ‘worth it’.
6. Quantifying value
We need a good offence and we need to take the fight to the customer before they lose sight of real value and fall into the transactional/price bucket. Even more importantly, when they are in the price bucket we need to shock them or inspire them to demand value and be willing to invest in getting it.
We know this works. There are many stories of success and examples where teams have worked together to deliver real benefit to the customer and has got paid for it. In these cases we have delivered much more than we could have by a bit of additional discounting and the customer has seen real improvements in the risk profile, productivity and profitability of their business.
7. Selling value
This is about selling outputs not inputs. The goal of the sales process is to quantify the benefits to the customer in hard monetary terms. Prize not price is our mantra – focus on the economic value added of our products and services, not on the technical aspects of what we do.
Robert Maguire runs his own consultancy and his experience spans the full range of outsourcing and vendor management issues from determining what to outsource, through developing an appropriate contract strategy and building a performance dashboard to negotiation and conflict resolution to deal with the inevitable management issues that arise in any long-term relationship. Through his consulting, coaching, mentoring and skills development interactions, he helps major organisations in the public, private and not-for-profit sector transform their thinking and approach to their commercial relationships. Robert’s clients span a range of industries including pharma, consumer products, telecoms, transport and public sector both in the UK, the US and the Middle East. He is an accomplished line manager and consultant experienced in all aspects of purchasing and supplier management. Prior to establishing his own consultancy Rob was European Purchasing Manager for Reckitt & Colman plc where he established a European procurement function for the purchase of raw materials and sub-contracted products. He has worked as a consultant at Price Waterhouse and Ernst & Young, and has worked with a number of pharma companies including Glaxo Welcome (GSK).