Whenever a client loses a major project to a competitor, the natural question is “why?” What did they do that you didn’t? What could you have done differently or better? Through the years, I have asked these questions of buyers, engineers and senior managers many times. It is interesting how similar the answers are no matter the industry in which the company was doing business. Whether or not it is a small manufacturer of industrial pumps or a major Tier One Supplier, the same themes keep coming through. Here are the top ten points that customers consistently agree upon when discussing what factors most often turn the tide on the sourcing of major, multi-million dollar contracts. Interestingly, none of them are price.
1. Do less talking and more listening. Customers are interested in suppliers who want to talk about their company and their issues and have specific ideas for dealing with them. Their advice: Do your homework upfront, understand the customer’s organization before you get there, ask good questions and really listen to the answers before you start selling them on a solution.
2. Use the tech review as a weapon of mass instruction. Way too many suppliers view the tech review as just another step in the sourcing process. The smart ones, however, see it as an opportunity to differentiate themselves from competitors, showcase their technical expertise and experience and to begin “teaching the new customer how to treat them.” The tech review is a great opportunity to teach the customer what makes you different and better than the other firms they are considering. Don’t send the second string.
3. Don’t assume anything. Even if you’ve got solid relationships or have done good work for the customer in the past, never assume you have the business in your back pocket. Buyers say being presumptuous can really irritate the selection team and turn a positive into a negative very quickly.
4. There’s no such thing as a courtesy meeting. Never go into a meeting thinking it is only a “courtesy” meeting that you have to get out of the way rather than an important encounter with someone whose respect and trust you need to earn in order to get the business. In the complex sales space, there are not only multiple decision markers you need to address, but there are also a wide circle of influencers who may not be able give you the business, but they can certainly keep you from getting it.
5. Act like you truly want the business. Although sometimes it may not seem like it, customers generally appreciate it when you put extra effort into the proposal process. The best business development teams treat the customer like they are already a client and don’t hesitate to invest heavily in understanding the customer’s business.
6. Add value at every step of the process. Don’t just “promise” to add value. Do it—in every meeting. Some suppliers go so far as to develop an entire presentation on “the voice of the customer” to demonstrate their deep understanding of the customer’s customer. Others offer to arrange a meeting with another customer of theirs who you have worked with on similar projects.
7. Show your bench strength. Having the owner spearheading the pitch is great. It demonstrates to the customer that the project is important to the supplier, and it will have the support of everyone in the organization, starting with the CEO or owner. Customers also point out, however, that it is really important to showcase the rest of the team as well. Most customers are savvy enough to know that although the owner or CEO may be involved in the project, the majority of the work will be done by the rest of the team.
8. It rarely comes down to only price. Yes, price is important. But price is rarely the deciding factor in the sourcing of a major program that is mission critical and requires significant value-add by the supplier. The reason is that if you’ve made the short list, your price was at least in the ballpark or they wouldn’t still be talking to you. Your price is your price.
9. Make the most of your oral presentations. An oral presentation is your chance to shine. Use it to make a difference to differentiate you, to justify your pricing, to showcase your expertise and experience, and more. Start out by asking the customer which parts of the proposal they would really like to spend time on and zero right in on those sections. Make your time together a discussion rather than a presentation. In short, don’t lecture the customer—engage them.
10. Be careful how you play the boss card. Our owner knows these guys’ boss really well. How should we use this relationship to get this business? Be careful. Name dropping can hurt you more than help you. Instead, use the relationship to learn more about the program, the internal politics, the selection process, the decision makers, the influencers, the customer’s concerns and hot buttons. Also, be careful not to abuse the relationship or put pressure on anyone.
11. As always, take this advice with a grain of salt and keep things in perspective. Not every RFQ you respond to warrants this kind of detail and homework. But in my experience, it seems most industrial companies get at least three to five “big” opportunities a year that could and should be handled differently than the more routine RFQ. Keep these ten points in mind and you’ll definitely improve your batting average on “big” jobs.
John R. Wirtz is president of Pinpointe Marketing, LLC, an Ohio-based sales and marketing firm specializing in the turned parts and engineered industrial products industries. He can be reached at 440-506-8963.