Five tips for better solution selling
Let’s face it, there’s a clear and distinct difference between selling traditional logistics and selling integrated logistics and supply chain solutions. The key difference is; one is a product offering and one is a solution. When you try and sell solutions like you are selling a product, it’s like bringing a gun to knife fight…usually with similar results…your sales cycle is DEAD.
The product sale is really a commodity. Commodities come with an “each” price or a “per pound” pricing matrix, etc. It usually is a short or shortened sales cycle and negotiations revolve around the total price and your typical supplier performance metrics.
The solution sale is much different. This sale is one that requires client discovery, isolation of unique client pain points (that only your solution can address effectively), and being able to drive distinct value for the client, and in turn, for your organization. This sales effort is highly specialized and requires selling time (sales cycle) that is much more detailed than a product sale. That being the case, you need to be sure that your close rates are high enough to justify the work load and sales cycle needed. You also need to be sure that the deals you close have a deal size that reflect the sales effort and cycle time (said another way, is the deal worth winning?)
I have been involved with organizations that sell products and those that sell solutions. Both can be successful, as long as you sell products like products and solutions like solutions. Here are a few tips on how to sell solutions so that you are not the one bringing the knife to the gun fight!
- Prepare, prepare, prepare. So often I see sales teams go into client meetings with no sales plan, no call to action, and no deliverables for themselves or the client. These “feel good meetings” are better left to conference calls or not done at all. Every client interaction should be a detailed exchange of ideas that enable you to discover ways to position your service offering at its highest value within your client. If not, you are wasting your time.
- Does you solution fit? Sure, we would like to think that our company’s solution is the next best thing since sliced bread. Truth be told, that’s not the case. If there’s no solution fit, there’s no sale. Discovering that early will save your credibility with the client for the future and save you embarrassment internally as well.
- Can your company win? We have all been there. We have the best solution for the client, but we still don’t win. Yes. It happens. Internal competition, the deal politics, and incumbent vendors all play a part. That’s not to say you only engage when there’s no competition, not the case at all. But if the engagement odds are grossly out of line, walk away early. No one gets paid for working a deal hard and getting second place.
- Do you want to win? You remember this feeling. You win a deal that doesn’t qualify internally in terms of size (too small), or you take it so thin in terms of margin that the profit doesn’t add up (too lean), or worse, you’ve over sold your capabilities and now your organization needs to stand on its’ head to break even (too bold). In selling solutions, size does matter. Don’t compromise here.
- Can the customer pay? Sure we all would like to think that the customer will pay us. But there’s alot that goes into that piece that needs to be discovered early in order to make the whole deal come together. First, only target companies viable for the long term. Sounds simple, right? Do your financial homework here and involve your credit department early in the prospecting phase. Second, even billion dollar companies have budgets. Is your client’s RFP approved? For how much (relates to #4 above)? Over what time frame? What will the terms be? No one likes to talk money until the end. I always suggest an early talk about budget to get an answer to whether to engage or not (deal size) as well as parallel discussion of deal terms so that you can craft those along the way. No money surprises at the end.
These are five important areas to explore early in the cycle in order to maximize your success rates. All it takes is sales discipline… which is another hot topic and blog to come.