But wait… is it really their fault? Putting yourself in their position may reveal some opportunities for your sales team to perform better.
So let’s imagine you are in their shoes now, what can you see? Do you also see these following things like they do?
“I see long Excel spreadsheets that usually have dated or incorrect prices. Sometimes I was given the wrong price list and only got notified about that a couple days later. If I can’t trust the prices I was given, how can I even negotiate confidently with customers?”
“I see no instructions about the discounts I can give to each customer, the magnitude of each type of discount, the price I should target, or the price I need to walk away from. And if I can’t see how different discounts affect transaction profit, how can I propose a good deal?”
“I see no tool that can help me quickly decide the price or evaluate different quotes. Whenever I want to calculate price or compare different quotes, I have to look through thousands of products on Excel, find the right cell that contains the information I need, and then do the calculation manually. That process is very time-consuming, and it’s easy to make a mistake by messing up just one number.”
“I see a very slow quoting process, but I can’t do anything about that. When I propose a quote, I can wait for days to get a response, not mentioning all the discussions back and forth until an approval is given. And by that time, the customer might change their minds already.”
“I see no reasons for me to try fighting for a higher price. My colleagues can close more deals by granting bigger discounts, and they are rewarded for exceeding revenue quota. On the other hand, I don’t seem to get any rewards for keeping negotiated price close to target price.”
“I see no differentiation in the product. Why should customers choose our products over competitors’? What values can we bring to customers that make us more desirable? I get really nervous when facing those questions.”
“I see ridiculously high prices given to me by marketing and finance people. They don’t know the customers at all. The only way I can sell is to give customers high discounts, but then I will be blamed for over-discounting.”
The list can go on and on, but the point to remember is, there are all sorts of problems that can get in the way of a successful negotiation, and they are not just your sales team’s problems. Gone were the days when customers were faced with little buying options and willing to wait for sales to get back to them. Customers nowadays are demanding as ever, and they also become increasingly educated thanks to instant access to lots of information resources. Thus, in today’s B2B selling, sales people must not only be good communicators, but they also need to be experts about the industry, the market, the company, and the product.
With such difficulties, is it fair to expect sales to deliver good results when they are not armed with timely and correct data, not given enough sales guidance and product training, and not able to use analytical tools to support their decisions? And can you really blame them for over-discounting when they are rewarded for only sales revenue?
The following is what you can start doing now to help sales people overcome the above challenges and deliver the results you want:
1. IMPROVE SALES TRAINING
Teach sales people the value that your business and products offer. Make them understand that they are not just selling a physical product. They are selling a buying experience as well. Value thus can be found in other aspects of the business, from a prompt delivery to ongoing customer support. Only when they are confident about the offering value, can they make customers believe in the same thing and defend their stand during negotiation.
2. REWARD THEM FOR DESIRED PERFORMANCE
If sales people are rewarded solely for the amount of revenue generated, they might commit in over-discounting in order to close as many deals as they can, even though that will hurt the company’s profit. Thus, to align sales with your interest, you should re-design the reward plan to acknowledge the effort of sales members who bring not only revenue but also profit to your business.
3. INVOLVE SALES LEADERS IN PRICE-SETTING DECISIONS
Never underestimate the direct market knowledge of good sales people. In the end, they are the ones who actually do the talk and receive all the pricing signals from your customers. Discuss your pricing structures with them would not only help you price more accurately, but also make them feel more involved and responsible for achieving the agreed target prices.
4. EMPLOY AN AUTOMATED PRICING OPTIMISATION SYSTEM
If you truly want sales people to deliver good results, let them focus on doing what they are best at, which is building relationships and selling. Don’t force them to navigate through a list with thousands of products and many complicated rules, just to derive the recommended selling price. Don’t expect them to be analysts and come up with the optimal price and quotes on the spot. Don’t make them worry about losing a potential deal because they can’t answer customer’s request for quotes immediately. Empower them with a tool that can give them the instructions and analytics they need, so they can do their job more effectively and efficiently.
The important role of sales people in B2B selling is undeniable. In the end, they are the ones who represent your company, bring in revenue, and build trust with customers. Be more understanding towards your sales team, arm them with the right tools and knowledge, and they may become the best sales team your company can ask for.