Cost cutting is nothing new, everyone is doing, it including your company, which is why it is hard to understand why sales people are so insulted when their clients do it. Don’t get me wrong, I am not suggesting you should grin and bear it, but it is time to take more proactive and profitable approach to something that is here to stay.
Lower level buyers look at the mandate to cut costs in a somewhat “linear” fashion; they see it as a need to reduce the costs right across all products and services they purchase. It’s the easiest approach, they need to reduce their spending by 10%, so they proceed to slash all their vendors by 10%.; no one gets insulted, they don’t have to think much, and they get to their goal. All vendors are treated as equals, even if they are not of equal value to the company. Sellers get to tell their managers about the great relationship they have with the buyer, “if not for the strength of the relationship it would have been much more than a 10% cut”. Buyers see the effort in figuring out an alternative as just simply being above their pay scale.
Sellers can bitch and moan but they have only themselves to blame. First because they put too much faith in a one sided relationship. More importantly because they get the “deer in the headlight syndrome” when they hear that the buyer is looking to cut cost. Most of the time buyer does not get a mandate to cut every line item in their budget by 10%, but rather that to reduce their overall spend by 10%. Meaning a motivated seller can take the lead and help the buyer out in a different way.
If there is a real relationship, implying some trust, some reliance on the seller’s expertise, the seller should be in a position to help the buyer cut their total budget in more creative ways. Looking at the entire eco-system, and helping the buyer find a number of efficiencies that extend beyond their product/service. For example, there may be opportunities to automate aspects of the buyer’s process, this may eliminate or free up other resources to apply to the company’s core offering. That is a cost saving, without a cost/spend hit to you. At times, achieving that may even put you in a position to sell them more “stuff”, they save on the total, and you not only avoid a cut but get more. Not always possible, but helping them find “other savings” is.
This is where if you view and present yourself as a Subject Matter Expert, that conduit to industry best practices, you earn the right to have and drive that discussion. But this is something you need to build to right from the first meeting, and at every opportunity.
The value of a real relationship is in how you can avoid being cut with the others, or even grow your revenue; not in how well you faired against the also rans. So go ahead, help your buyer slash their spend.