All about Selling

** Article: Is Successful Selling All About Lowest Price? – By Charles Dominick **
----------------------------------------------------------------

In most of my public speaking appearances, I speak to groups of corporate purchasers. However, I recently had the enriching opportunity of speaking to a group of sales professionals.

I asked them to tell me about the experiences they've had with purchasing groups that have frustrated them the most. I got some interesting responses!

One phrase that was repeated often was, \"It's all about price!\" These sellers felt that many purchasers do not seek the supplier that will best serve their organization, but instead always seek the cheapest supplier.

I assured them that this was not the case in most progressive purchasing and supply management departments. However, that is not to say that their perspective did not have merit. It does.

I summed up why they had the experiences that they had in this blurb: \"It all comes down to what can be quantified in financial terms. When price is the only thing that appears to be quantifiable then, yes, it does all come down to price. However, when paying a higher price can yield a quantifiable return (e.g., minimizations of other costs), a well-trained purchaser will make the decision that has the most favorable net impact on the bottom line.\"

There are many other aspects of doing business that affect the bottom line. Are you, as a seller, considering them in the same way that your potential customers are?

If not, consider evaluating how these costs of doing business with you differ from the costs a customer may incur when doing business with a competing supplier:

- The cost of acquiring a product or service
- The cost of using a product or service
- The cost of supporting a product or service
- The cost of maintaining a product or service
- The cost of disposing of a product or service
- The cost of poor performance

Just to illustrate the detailed analysis that a corporate buyer may do, I'll provide the steps that he or she would follow to take into account the estimated cost of a seller's poor performance. This approach is most commonly used by large corporations who are doing business with two or more competing suppliers and wish to consolidate their supply base.

Here's their 6-step process...

1. They define \"events\" that constitute poor service, poor delivery, and poor quality. For example, a poor quality event may be receiving an incorrect invoice.

2. For each event, they determine its average cost to their organization. For example, an incorrect invoice may require their accounts payable and purchasing staff to dedicate 3 man-hours at a rate of $30 per hour to resolve the problem. Thus, the average cost is $90. They apply the same average event cost to all suppliers.

3. For each event, they determine the percentage rate of occurrence using historical information. For example, if 10 of the last 1,000 invoices that a supplier provided were inaccurate, the percentage rate of occurrence for that supplier is 1%. They express the rate of occurrence in a decimal format (e.g., 0.01). Each supplier will have a different rate.

4. For each event, they determine the number of opportunities for the event to occur. If suppliers will invoice them weekly over a two-year deal, there will be 104 opportunities for an event. The number of opportunities will be the same for each supplier.
5. To estimate the cost of poor performance for each event, they multiply these three things together: the number of opportunities, the rate of occurrence, and the average cost per occurrence. Cost of poor performance per event will differ by supplier.

6. For each supplier, they add the cost of poor performance per event for all events to the corresponding supplier's price. The supplier with the lowest total cost after factoring in the cost of poor performance will generally be the ideal choice, considering price and performance.

So, you can see, it is not all about price in all situations.

Knowing how the buyer will evaluate your proposal is a big advantage in successfully selling to large companies. Helping the buyer understand how your company minimizes the total cost of doing business is the key to getting your proposal evaluated favorably by today's sharp purchasing professionals.


About the Author:

This article was written by Charles Dominick, C.P.M., SPSM. Mr. Dominick is the president of Next Level Purchasing, Inc., a company dedicating to helping purchasing professionals have successful careers. Next Level Purchasing can be found on the Web at http://www.NextLevelPurchasing.com



---------------------------------------------------------------
** Article: Is Your Knowledge an Obstacle to Selling More? – By Jeremy Cohen **
----------------------------------------------------------------

Imagine you had the opportunity to ask Albert Einstein or Stephen Hawking what they do for a living and how they do it. Chances are, after fifteen minutes of astrophysical prattle your head would be spinning and you still wouldn’t quite have the answer to your question. They are both geniuses hopelessly immersed in their fields.

When it comes to your business, you’re the genius. As an independent professional or small business owner you pride yourself on your vast repository of knowledge about your services or products. You could talk for hours about your latest technique, newest gadget or industry trends. Your success is ultimately predicated on your ability and acumen. But in order to be as successful and as profitable as you want be you need to maximize your ability to sell your gadgets or contract for enough applications of your techniques and services.

If you’ve had some success in business you’re undoubtedly doing something right. If you’ve found that sales have leveled off in order to reach your next level of accomplishment, however, you will likely have to try something new or take a different approach to marketing. As a successful person (or someone who aspires to be successful) a method for increasing sales is to reevaluate your marketing material and make sure that your knowledge isn’t jamming the effective communication of the value you provide.

Here are some steps you can take clarify what changes you can make to your marketing to increase sales and be more profitable.

Examine Current Clients

Who are your current clients? Are they people you were already pretty much in the know about the technicalities of what you do or sell or did you have to educate them to understand how you can help them?

If you find that most of your clients were pretty savvy about how you can help them before you marketed to them there is likely opportunity for you to expand your market by reaching out to those who don’t inherently understand that you can help them. What steps can you take to enlighten those who don’t quite understand they can benefit from your service?

Examine Your Marketing Material, Advertisements and Websites

Often times your first contact with your prospects comes in the form of a brochure, advertisement or website. Are these tools only speaking to a fragment of your market?

Here’s a quick, inexpensive way to determine whether you can increase targeted response to your marketing collateral by clarifying the results and value you provide .

Ask your friends and family who are in very different fields of work from you to review your brochures, advertisements and website. Next, ask them who your clients are and why your services or products are helpful to them. If their answers are inconsistent and unsure your marketing material may be too highbrow and is likely alienating potential clients. How can you clarify your value and communicate more effectively to a larger targeted market?

Move Your Marketing Forward.

Don’t let you knowledge get in the way of making another sale. Make sure your marketing material clearly and concisely communicate who you help and the value of the help you provide and watch sales soar.


About the Author:

Jeremy Cohen helps professional service providers and small business owners increase profits with decreased marketing costs and increased revenue. Download his free marketing guide, More Leads and Sales - Sensible Steps to More Profits, Clients and Success