Sell Or Negotiate – What’s Your View?10

By Tibor Shanto -


Had the opportunity to listen in on an interesting discussion the other day between two sales practitioners, they were not aware of me, or what I do, I was just snooping. One, we’ll call him Fred, was telling the other, Joe, that he was looking forward to a negotiations program his company was sending him to, he felt this would help his sales. The other fellow, a bit more subdued and low key in his manner, smiled in a way that practically said “you silly sod”, suggested that the course may help his numbers occasionally, but will in no way help him sell better. And the battle was on.

Fred was saying that he often felt unprepared for the negotiations phase and having some solid training and a process to manage that part of the sale could only help. He insisted that knowing how to negotiate in a professional way would also allow him to arrive at a mutually acceptable, no one compromised, conclusion to deals. A win win, where both parties can walk away feeling they had accomplished a good thing for their respective organizations and cause.

Joe had a different view. He said he believed that the job of a sales professional was to build value for both parties throughout the sale, so by the time they arrived at the conclusion, both saw enough value in the deal that there was no need for what many call negotiations. If the sales person does what he/she is paid to do, they align their sales process with the buyer’s buying process, and communicate value in a way that there was no need to “add another act at the end of the play”, just to meet at a mutually acceptable point. That is why he felt that a negotiation process may help Fred’s numbers in some deals, but would not make him a better seller, in fact as Fred said, “you’ll become a lazy seller, looking for the negotiation phase to win the deal, instead of really and completely selling it from the start.”

Joe insisted that even when you execute the sale well, “there is always some need to negotiation, if not haggling, negotiations.” Joe, was resolved, “there will always be some discussion of some terms, some conditions, “things like delivery dates, small stuff, but if it is down to full blow negotiations that includes a piece on price, you did not sell the deal to begin with.” Joe said.

Since I could not see them directly, I am not sure if Fred read this next part from a brochure directly or just memorized it, but he said “you know Joe, every dollar you gain through negotiations goes straight to the bottom line.” I could hear Joe chuckle as he calmly replied, “every dollar of value you sell from the time you prospect them, take them through information gathering, through to proposal, also goes to the bottom line, but I don’t have to add an unnecessary stage to the sale, I’d rather sell it, then negotiate it.”

They kept on for a bit, I got off before it ended, I am sure they negotiated an amicable outcome.

But who do you think was right or closer to best practices, Joe who said sellers should sell, or Fred, who I am sure will get something out of his course? Let me know.

What’s in Your Pipeline?
Tibor Shanto


Just Mailing It In (#video)37

By Tibor Shanto –
TV Head

It is bad enough when this expression is used figuratively, but it is sad and dangerous when sales people actually and literally do it.

What’s in Your Pipeline?
Tibor Shanto


Keep Your Success In View!103

As sales professional you work hard to get a sale to a point of proposal, and every day buyers will have you do things that could introduce unnecessary risk to the sale.  Some can be managed, but some are harder, because you feel pressure, real or not, to take actions that you should not take.  Specifically when buyers ask you to ‘send’ them your pricing/proposal/quotes to potential buyers. 

Across a number of industries, sales people tell me that they have submitted pricing/proposals, and are “waiting to hear back”; what’s with this waiting?  Along the same line they tell me that they “sent pricing in and promised that I will follow up on Friday”.  Really, just send in pricing, like tossing the latest community paper on the lawn.

Here is a rule to live by, never send in proposal/pricing without a scheduled time for review!

I know this seems simple and straight forward, but it seems not, people do it every day, look to your left, look to your right, and I’ll bet you saw at least one rep who does this if not more.

If the prospect requests a proposal or pricing, the clear course of action is to set up a time to present and review it together.  Obvious, yes; reality, not always.  If you can’t get the appointment to present, schedule a specific time for a call; if they are hesitant, ask yourself why.  I know it is hard, but you have to believe that a potentially sincere buyer would see that as a good next step, if not, you need to think about why, are they just trying to rationalize a decision they have already made, will they use your proposal to get concessions from a current provider, why not take the time to review it together, is this a game you are willing to play?

There are times where you can schedule the review by offering to send in the proposal in advance.  But again you need to make sure you are on a level playing field.  Send it in too far in advance and it can work against you.  They may love the proposal, and then spend time on how to negotiate further.  You want to be in a position to take in their initial visceral reaction, not once they have had a chance to rationalize with time.

So here is the plan, say you schedule a phone presentation for 2:00 pm Thursday.  Most would send in the document a day or two in advance or even the morning of.  My idea of advance is 1:59, hitting the send button as the ringing begins on the phone.  Again, the goal here is to be able to work with the buyers real reaction, not a tempered contrived reaction.  Of course some of this can be addressed if not eliminated early in the sale, but if you do find yourself in this situation, you can still work on a level playing field.

What’s in Your Pipeline?
Tibor Shanto

Bid It Up – Sales eXchange 15657

We all know the challenge price presents in today’s B2B selling environment. We all love to talk ‘value’, but often fail to define to ourselves before we engage with a buyer; then fail to define it with/for our buyers, and leave them wanting once “we’ve delivered our value proposition”.  Our job as sales people is not to propose value, but to deliver it, and ensure that we and our companies are fully compensated for that value, which once again takes us back price.

While we would all prefer not to deal with price, it seems almost unavoidable, almost a cultural must when it comes to buying/selling, and hey we do it when we are spending the cash.  This leaves you only with the option of how to mitigate or minimize the negotiation dance; and you have a couple of choices as to how to do that best. 

The first, and most popular, is a method I call Build Up and Defend.  This is where you pack your offering, pitch, and proposal with “tons of value”, and throw it at the client with everything you got, and then defend that “value”.  We’ve seen this in different formats, but the goal is to wow the buyer, and persuade them that they are getting everything they had defined as being required, and more.  While this works, and there is nothing wrong or dishonest about it, it just seems like so much redundant overkill, which draws on unnecessary resources on the part of the seller, and usually overwhelms the buyer, thus introducing risk to the sale.  This usually ends with the buyer looking for the “real value” in the form of price concessions, and the seller either conceding because they need to make quota, or better sellers taking things out of the mix in order to balance to make concessions equitable. 

An alternative to the above is to be more methodical, and leverage the Discovery stage, and the information exchange to build value with the buyer.  You do this by a) Building Better Questions, focusing in on only the most important and relevant factors for the buyer, rather than every “potential” irrelevant data point, whether it has value or not.  With the base value points identified, you then use that foundation to drill down, and further establishing where the buyer will find value in our deliverable based on their specific requirements, a process called GAP Selling.

From a pricing standpoint, this allows you to build from that base and bid the price up with every element of value you and the buyer mutually establish and agree on.  There is no rule that states price discussion has to start at a point and then be ratcheted down.  Done right, you can build value with the buyer, on their terms, and at the same time bid up the price, not down.

What’s in Your Pipeline?
Tibor Shanto

Put Price in its Place31

Price continues to be the boogie man for many sales people; soft economies just serve to compound and heighten the situation giving buyers an obvious lever in sales negotiations.  But it doesn’t have to be that way, and that is not just me trying to be enthusiastic and up beat, it is a fact, unfortunately a fact that sales people don’t use to its maximum impact.

Survey after survey of buyers, show that when asked for reasons they buy from the companies they buy from ongoingly, show that price is rarely in the top three, in some cases it is not in the top five.  Given that, I ask why sales people choose to focus on price, when there are clearly other factors buyers rank higher than price.  Let me state right here that at times things are said in response to surveys that don’t always correlate to behaviour when buyers are in buying mode, but there is also enough evidence to show that price is not top of  the list unless it truly is a commodity; even then I have worked with people selling commodities who have been able to leverage the other reasons/factors on the list above price.

As with all things worth doing in sales, there is some work involved, despite what some soothsayers will tell you, there is no silver bullet in sales.  First, identify those things above price, and those item that help balance or neutralize price.  You can start with checking out “How to Sell at Margins Higher Than Your Competitors : Winning Every Sale at Full Price, Rate, or Fee“.  You need to also understand why it is people buy from you and your company, which is easy if you get into the practice of not just doing won/loss/ND reviews, but also to go back to the buyers who went with you and ask them straight out what factors impacted their decisions.  Clearly you want to lead with the ones that are working and address to alter those that are working against you.

While not universal, you’ll find that serious long term buyers, especially those who understand that a healthy supplier makes for quality products and satisfied downstream customers.  Yes everyone wants to economize, but that does not equal low prices.  It is up to the sales person to help the client understand why the price equals relative value, not an absolute number.  Most sales people are familiar and speak to the concept of “total cost of ownership”, but do not a complete job in engaging the buyer with it.  Often laying out the story but not filling in all the pieces, making the assumption that the buyer will recognize the advantages, they don’t, that is our job.  It may take work each time, but it will pay dividends every time, both by helping you close more of the right buyers, but also in eliminating price shoppers.

Next Steps

  • Find out what your existing customers value beyond price
  • Develop a process for raising and leveraging things you uncover in the above point
  • Lead the process rather than hoping the buyer will put everything on the table in a neat way

What’s in Your Pipeline?
Tibor Shanto

Dealing with Price in the Real World26

A few weeks back I gave you permission to go ahead and sell on price, so long as specific conditions were met and adhered to.  One central condition being that you can deliver full “value” at your price.

Ah, value, the ever-present and undefined term in sales, so before going further let’s define value right here:

Definition of Value:     Those offerings that remove barriers, obstacles, or helps bridge gaps present between where the buyer is now – and – their objectives!

Buyers will attribute value in your offering if can see, understand, and accept, that it will help them eliminate barriers and/or bridge gaps between where they are now and the objective(s) they are seeking to reach.  Absent that you are condemned to sell by adjusting your price, usually downwards, until it is low enough for the buyer to rationalize the relevant value. Of course I want you to do is build relevant value to the point where YOUR price is great value.

Once you master building the value (using the EDGE Sales process and the GAP Selling methodology), you can develop the means and conviction to deliver your price with the confidence and knowledge that it will help your buyer to achieve said objectives.

But let’s be real, even when you execute well, buyers will still bring up price as an objection, it is almost expected, and we need to deal with it.

So there you are cruising down the freeway, armed with the factors above, and hot breakfast in your belly, you are ready to present your proposal.  You cover everything and gain agreement on key elements, leaving the price for last, you present the numbers, with confidence, and the buyer pushes back, now what?

First, don’t get excited, if you have executed the process, continue leveraging it, calmly ask the buyer, “OK, please share with me, (tell me) what price (number) you had in mind?”  after all, you need to frame what you are dealing with, based on events you had to put a number on the table, it is only fair that you know what number they were working with.  BTW, you can often avoid this by establishing their budget, budgeting process, and how they have dealt with budget/cost over runs in the past.  Knowing that early, when there is much less pressure can be a real advantage.

When they come back with a number, do be offended, don’t get excited or defensive, a – it’s their number not yours; b – its just a number without context.  Instead, politely ask, “how did you come up with that number?”  Remember above I said you need to be confident in your number, know why it is that number, know and quantify the value you will deliver for that number; so if you were asked to explain how you arrived at your number you could do it, and with practice, do it easily, so it is only proper that they should be able to explain how they came up with their number.  Sometimes they can, in which case you will have to evaluate your options, one of which is to walk away.  But in the process of them explaining, you will gain the insight you need.

More often, they can’t explain their number, they either had a number in mind without much back up, they pulled it off the web, they got a price from another competitor, or some other less than relevant source.  But without the ability to reason things out, it will facilitate an opportunity for you to review the facts and issue you covered during Discovery.  At this point you can decide if you can help them understand your pricing, where their will see an ROI, and make full use of all the impactful thing you uncovered during the Discovery stage.  In the end you still have the choice of re-establishing the value or moving on to the next prospect.

Next Steps

  • Become proficient in understanding where and how you deliver real value
  • Be ready and confident in your price
  • Read ” The WOW Approach to Price Negotiations
  • Make sure you have plenty of real prospect in your pipeline so can afford to walk away

What’s in Your Pipeline?
Tibor Shanto

How To Stretch Your Value to the Max! – Sales eXchange – 10630

Through the mid and late 1990′s I sold an information solution, delivering live content directly into companies LANs, allowing them to create alerts. Not that big a thing today, but keep in mind this was before the Web, and while the delivery is no longer a challenge, functional and useful alerts, now marketed as triggers by many of the same folks, are still being sold, if not always bought.

The leaders of the company used to carry out a strange annual ritual that demonstrated their desperation and lack of sound business thinking. This specific product sold for $3,000 a month or $36,000 for the required minimum annual subscription. Every December the “Leadership”, would roll out the same special offer, an annual subscription for $30,000 if the customer committed before the all-important year-end, a $6,000 discount for those who bit.

The plan, theory, hope, as it was explained, was that once the service was flowing through the customers’ networks, and they had a chance to experience it, renewing them 12 months later at full price would be a mere formality.  Right!  To this day I am not aware of one client who renewed at full pop, all the renewals were all at $30,000 never $36,000. Not only did they never recover the cost of acquiring the account, but ended up paying a further $6,000 penalty for as long as the client maintained the service.

There were a couple of lessons and I learned from this, one right away, there other got clearer over time, especially as I sold more involved solutions.

The most important lesson set in after a couple of years of this silliness, when I realised how to leverage the reverse of the phenomenon.  Our losses stretched out as long as the client maintained the service, $6,000 per year, four years, $24,000.  Therefore, the same had to be true when a client was realising value from our service.

If you can get agreement from a buyer that using your service, they will save $20,000 a year; or using your service they can increase sales resulting in a $25,000 increase in net earnings, you can then extrapolate that out over the life of the service you sell.  Most sales people don’t go this extra step, they will stand their ground on that first figure.  So if your product costs $20,000 it may not look that attractive at either $20K 0r $25K return; but what if they had the benefit of your product for four years.  That changes things; they now have the potential to see an $80,000 benefit from a $20,000 investment.

It is important that you establish two basic things, first, and I mean first, the duration of the positive impact of your offering, it has to be established first, not that hard if you follow a disciplined approach to Discovery.  Second, the value gained, whether that is increased sales, reduced costs, longer asset life, reduced time to market, you name it, (well actually let the buyer name, you ask the questions that lead to that).  Armed with those two things, you are not only set to achieve full price for full value, but the elimination of a lot of daftness from the sale, for both you and the buyer.

For example, if I can get a buyer to see that my training will bring in an extra three sales a year, and he tells me that each nets $1,200, that’s $3,600.  If his average tenure for a rep is five years, that brings it to $18,000; makes the initial investment of $1,500 seem like a steal, even if we added in an annual refresher at $500, still total investment of $3,500 per rep, still leaves a return of $14,500 of the five years.  (Note to self, need to raise my prices).

The other obvious lesson learned was not to sell at a discount.  Once you sell it at $30,000, you have established the value, and all the dancing and barking you do when trying to renew does not change that fact and the value you set at $30,000.  Yes, there are arguments you can make, proof of worth you can present, but all that is just decoration, the fact is you sold it at $30,000, and that’s what it’s worth.  Some of the leadership threatened to withdraw the service, but not only did they lack the anatomical make up to do that; but they and the local rep had become addicted to the crack-revenue, and no one was going to suffer the withdrawal pains.  Besides, they would have to go out and replace what they lost, and they have shown that that was beyond their means.

What’s in Your Pipeline?
Tibor Shanto

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Five Tips to Negotiate Your Deal Through Email5

The Pipeline Guest Post – Jeanette Nyden

We have a love hate relationship with email. We love instantaneously sharing information with a lot of people. But, we also get spammed or deluged with irrelevant “reply all” responses.

We have the same love hate relationship with using email to negotiate deals. Sometimes we love how efficient email is. But, studies show, we lose more than 50% of our deals when we negotiate exclusively using email. Email negotiations are here to stay. What can you do to effectively negotiate your deal through email?

1)    Email Has Limited Value to the Negotiator. Recognize that email messages are easily misunderstood and can create a cascading effect of communication problems with buyers. So much of human For example, when answering a buyer’s questions about her shock at the price increase in your latest proposal, acknowledge her surprise in the email. Simply answering her with a canned pitch that prices go up every year is not appropriate, especially in an email.

2)     Carefully Select Subject Lines.  Subject lines are your first impression. Use them wisely, and don’t be afraid to change the subject lines to fit the body of your email.

3)     Structure Your Email for Impact.  Long, rambling emails will confuse the buyer. Time is at a premium with buyers. Clearly structure your emails to make it easy for the buyer to follow the back and forth negotiation process.

4)     Learn to Engage the Buyer in a Back-and-Forth Conversation.  Negotiation is all about the conversation. It requires a lot of back-and-forth conversations to get to the final deal. Ask the buyer questions before dumping data or throwing out a proposal.

5)     Make Effective Tradeoffs.  A tradeoff is a mutual exchange of value. Times are tough; margins are tight and buyers want more from you. To balance their demands with sound business judgment, make a tradeoff.

Email is here to stay as the preferred business communication tool. Learn to use email effectively by recognizing its limitations. Then make small, significant changes to what you include in your email message. You will increase the odds of negotiating a great deal using email.

About Jeanette Nyden

Jeanette Nyden, author of Negotiation Rules! A Practical Approach to Big Deal Negotiations and the co-author of The Vested Outsourcing Manual, is an attorney, mediator, and professional speaker. As the president of J. Nyden & Co., Inc, she provides negotiation skills seminars to mid-market companies. For free negotiation resources, visit

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Selling a Price Increase in a Soft Market14

The Pipeline Guest Post – Mark Hunter

Continuing our Guest Post series this week with Mark Hunter, who specifically want to thank for getting me to think about creating this series of posts by other leading thinkers on sales.


Selling a price increase can be difficult in nearly any type of situation, but trying to sell one in a soft market can be downright brutal.  Yet, as unpleasant as it can be, it is often essential.   The problem of selling a price increase in a soft market usually stems from the fact that the salesperson and the customer are coming at the situation from different perspectives.  Especially in times like this, it is imperative for the salesperson to understand that regardless of what the market or economy is doing, if a price increase needs to be sold, it needs to be sold.  This means that the salesperson can’t go into the sales process believing that the customer is going to reject the price increase unless the deal can be saved by offering some type of discount.  If they approach the meeting with this attitude, they almost guarantee failure because a customer will never pay more than a salesperson tells them to.

In these types of situations, the first thing that often happens is a comment from the customer about how soft the economy is, how prices are really going down, and therefore, how a price increase at this time doesn’t make any sense.  When the salesperson hears this, they usually agree because they hear and see the same thing.  However, as soon as they do this, the battle is lost and 9 times out of 10, the only thing that can save it is some type of discount.  To counteract this problem, when the salesperson hears the customer make this type of statement, they should ignore it.  Yes, ignore it.  The reason?  Many times the customer merely wants to get it off their chest and by telling it to you, they feel better.   The first response the salesperson should make is to ask the customer questions about how they intend to use what they’re buying and whether or not they’ve been able to achieve the results they’re looking for.

If the customer continues with their line of discussion about the economy and they can’t accept the price increase, then the salesperson should ask about the steps involved in their buying process.  The objective is really to get the customer talking.  Initially, this can be a little scary because the customer may begin ranting about how they always go for the low price.  After they get done explaining their process, the salesperson should question them about how their own customers decide to buy from them.  It’s in this part of the discussion that the customer begins to see how and why quality and confidence are such big items in any purchase decision.  A good salesperson will then pick up on these two items and reinforce them with follow-up questions that get the customer to further explain the importance of quality and confidence.   When the customer sees what they’re buying in this light, the price increase becomes a much smaller issue.

Sometimes even after this conversation, there will be customers or purchasing departments who will still not accept the price increase.  They usually comment that they will find another vendor to buy from.   This is often a veiled threat to get the weak-kneed salesperson to cave in with a discount.  For the salesperson, this type of discussion is best thwarted by ensuring the end-user fully understands the value and benefits they will receive from their product, as well as by clearly communicating the amount of pain the customer will go through should they decide to switch.  First, the cost of converting to a new vendor is always much higher than initially thought, so the discount the new vendor has to offer needs to be significant.  In addition, it might be easy for a customer to find a new vendor at a lower price, but on many occasions, the lower price vanishes after the initial order and, suddenly, the new vendor is at the same price as the original one.  Furthermore, the new vendor will not have nearly the knowledge or expertise as the original company about how to service the customer, so the switch often winds up costing more money in the long-run.

As a final line of protection, I strongly believe the salesperson communicating the price increase should not have the authority to make any price concessions.  When this power is taken away from the salesperson, it’s amazing how much tougher they are in executing a price increase.  By requiring the salesperson to get approval from someone else, it also takes the salesperson off of the hot seat and, many times, as soon as the customer is aware of this, they will stop badgering for a discount.

Selling a price increase in a soft economy is certainly harder than selling one in a booming market.  However, as professionals, salespeople need to take the time to know and understand how to sell a price increase in all types of markets.  It doesn’t require herculean skills.  It requires the diligence and patience to keep the discussion focused on the benefits the customer is looking for from both the product and from you, the salesperson.

About Mark Hunter

Mark Hunter, The Sales Hunter works with salespeople and companies helping them maximize their profit by maximizing their price.

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Price – What’s in a Number?8

Price will always be a key component of any sale, but it does not have to be the only factor in a decision, unless you as a sales person let it. Based on the studies you read, price can be as much as 40% of the final decision; and with certain individuals, it could go higher. However, when you step back and examine things, what is price?

At its most basic, it is the numerical value, nothing more. As with any number, there is no good or bad number, there is only the relative aspect it represents. It brings to mind the old joke explaining the concept of how numbers are relative by pointing out that three hairs on your head are relatively few, but those same three hairs in your soup, well. Just like +1 is not better than -1, they both represent a relative distance from zero; just as when it is zero degrees outside, it does not mean that there is no temperature, it is just a point between -1 and +1, slightly colder if you measure things in Fahrenheit.

Read On…

What’s in Your Pipeline?
Tibor Shanto

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