Kahle Way B2B Sales Blog

By Dave Kahle
In this economy, everyone is looking for a simple fix to survive and arrive on the other side intact. Some even occasionally entertain dreams of growing just a little bit. Few are happy with their situations. And all but a few point their fingers at the economy as the source of their dismay.

The comments I overheard at one of my recent Top Gun seminars were representative. One sales person complained that his customers were shrinking and going out of business. Several complained about customers’ pressure to lower prices. Still others complained about desperate competitors’ feverish attempts to generate cash flow by dramatically discounting.

There must be a genetic inclination in the human race to look outside ourselves and blame those things that are outside of our control for our situations. We lament the conditions outside of ourselves, and cast ourselves as victims. If only someone else would fix it. Maybe the government will make everything good again.

Unfortunately, as long as our gaze is directed at “them” – those conditions in the market that have changed and are outside of our ability to control – we will never free ourselves from the constraints on our income and prosperity. We can’t do anything about “them.”

The real secret to improving our conditions is to work on “us.” James Allen said:
“Men are often interested in improving their circumstance, but are unwilling to improve themselves, they therefore remain bound.”

Sales people, sales managers, and sales executives need to look inward — at themselves and their sales teams — for the solution to their problems.

Sales People

Sales people must understand that it was OK just a few years ago, to “have your own style of selling,” to never invest in your own improvement, to make your living off of your existing relationships. Today, all of these are obsolete ideas that must be changed. It’s time to look inward, and fix yourself.

To effectively deal with the changing economy, sales people must become more strategic and thoughtful about the investment of their sales time, and they must bring value both to the customer and to their employers in every sales call. They must view their jobs as professions, not just jobs, and become serious about improving themselves. In a world where it is blatantly obvious that good sales people sell more than mediocre sales people, they must decide to become better. That means investing in their own improvement, and striving to achieve higher levels of competency and thus, better results.

Those sales people who survive and thrive in this climate will be those who understand the path to their prosperity lies not in the outside world, but in themselves.

Sales Managers
Likewise, sales managers have to stop coddling those sales people who aren’t interested in, or committed to, continuous improvement and greater levels of productivity. They need to put in place practices and disciplines that call for quantifiable expectations on the part of their sales team, regular measurements, and greater thoughtfulness and strategic planning.

They must demand continuous improvement and thoughtful efforts to increase market share.

Sales managers must look inward, understanding that their chances of success are dependent on them, not the market. That they can do it better, and that doing it better brings better results.

They must examine their sales forces, and use this window of opportunity to weed out those sales people who have no interest in developing, who don’t have the capability to succeed as a professional sales person, and who aren’t committed to their own personal success. Now is the time to review the bottom third of their sales forces and aggressively seek to upgrade.

Sales Executives

CEOs, and CSOs (Chief Sales Officers) need to recognize that the current state of the economy, and the resulting impact on the attitudes and perspectives of employees, has delivered a once in a lifetime opportunity to make significant changes in the structure of the sales force.

Recall just a little over a year ago. To make wholesales changes in sales territories, account responsibilities, the role of the inside and outside sales person, sales management practices, compensation plans, and expectations for continuous improvement – all of these initiatives would have been met with resistance from the majority of the sales force. Today, most sales people are willingly cooperative, acutely aware that they can be easily replaced if they don’t follow your lead.

Those CEOs and CSOs who look inward and use this window of opportunity to streamline and rationalize their sales systems will increase their productivity and lay the groundwork for disproportional growth when the economy turns up. 

The world is full of victims who lament their condition and blame their fate on sources outside of their control. Leaders accept their responsibility to look inward and improve themselves.

A. by Dave Kahle
You really have two choices. The first, which, unfortunately, is the solution to which most companies and sales people currently subscribe is this: Do nothing differently, complain a lot and hope that things change. Maybe the government will fix everything.

The second, which is my recommendation, is this: Move outside of your comfort zones, become a whole lot more strategic, thoughtful and better at what you do, and do some things differently.

Begin by analyzing your market to identify where your opportunity lies. Unless you have 80 – 90 percent of the total market in your area, you have opportunity.

Typically, you’ll find that there is market opportunity within your current customers, as well as opportunity in prospects who do not currently buy from you. Collect information about both groups so that you can make good decisions about where your time is best invested. Then, prioritize those prospects and customers based on their potential. Visit www.salestimemanagement.com for lots of resources to help you do this.

Then, strategically develop plans to gain more market share from each of these two sources. 

Proactively create the agenda for the conversations between you and your customers. For example, if one of your customers is buying half of their purchases from you and half from someone else, identify specifically what they are buying from your competition, and develop plans to gain that business. Ask yourself, “What would it take for them to buy it from me?”

Don’t settle for the simple answer “lower price.” Think more deeply, uncover deeper motivations in the customer and answer that question, product by product, category by category, for everything they are buying from someone else. Here’s a great question to ask, “What has to change for us to do more business here?”

Listen to their answer, and respond appropriately. Put together specific, persuasive offers to each customer and methodically present them to each customer. Show them, specifically, why they should do more business with you.
You are not done yet. Understand the fundamental sales equation: Relationships = opportunities = projects = money. In other words, the quantity and quality of your relationships equals the quantity and quality of your opportunities, and those opportunities develop into projects (purchasing cycles) and those projects turn into sales. 

If you want to sell more, you must develop more and bigger projects, which develop from more and bigger opportunities, which emerge from more and higher quality relationships.

If your sales are down, either you aren’t very competent, (in other words, you are not very good at turning relationships into money) or you need to increase the quantity and quality of your relationships.

Work on two parallel paths: If all the key decision makers and influencers in your current accounts don’t know you, then work hard to create those relationships. At the same time, look outside your group of current customers, and create relationships with prospects. In other words, work diligently, methodically and systematically at creating new relationships and thereby, new customers.

I realize that for a percentage of sales people, this sounds pretty basic. If that’s the case with you, there is power in refocusing your efforts on these fundamentals and work at doing each of them better. For you, the issue isn’t doing things differently, it is doing them better.

There is another group of sales people for whom all of this sounds too different and too far outside of your comfort zones and skill set. This is not how you are accustomed to doing your job. Remember where we started, “Move outside of your comfort zones, become a whole lot more strategic, thoughtful and better at what you do, and do some things differently.” If this is new and uncomfortable for you, then the next year or so will be one of the most challenging of your life. You’ll need to diligently work at developing these practices.

You may want to look at my coachinar series as a way to get help.

The world is full of people who will tell you that success in this environment is a matter of “secrets” or simplistic solutions. I wish that were the case. Unfortunately, sales success is the result of years of hard work, constant improvement, and thoughtful and diligent efforts. If you are serious about wanting to change your circumstances, you’ll need to begin to change yourself.

It continues to amaze me that so many salespeople shuffle into most of their sales calls with very little, if any, prior planning. I suppose that is why this is one of the practices of the best.

Most surveys of how field salespeople really spend their time conclude that the typical salesperson spends somewhere between 25 to 30 percent of the work week actually talking with customers. Just think about it – that time spent with customers is the heart of your job. Of all the things that you do in a typical work week, of all the tasks that you perform, nothing is more important than that!

Without time spent with your customers, your company would not need to employ you. Everything else that you do is either a result of, or in preparation for, your person-to-person sales times.

Combine that with the growing pressure on your customers to make good use of their time, and you have tremendous pressure on salespeople to manage an effective, purposeful and valuable sales call.

How can you possibly do that without spending time preparing for it? The answer is, of course, that you can’t. 

That’s why the best salespeople meticulously plan every sales call. That planning process brings greater value to the customer, and greater return to the salesperson.

What’s involved in planning a sales call? Typically, a well planned sales call has these components:

A set of objectives for the call. 

An agenda.

A set of questions, prepared for the situation

All the necessary material and collateral (literature, samples, etc.).

A variety of “next steps” the customer can take as a result of the call.

Time spent reviewing the account profile and/or personal profile previously compiled on this customer.

Sounds a bit arduous doesn’t it? Clearly this takes some time.
In my first full time sales position, my manager shared some advice with me that has stuck with me ever since. “Spend 20 percent of your time preparing for the other 80 percent.”

I’ve followed that rule ever since. It means that you discipline yourself to invest the necessary planning time for every sales call. Then, the time you spend in conversation with your prospects and customers will be valuable to them, and valuable to you.

To shrug it off and make a sales call that is unplanned, unfocused and unorganized is to waste your time and your customers’.

That’s why the discipline of thoroughly planning every sales call is a best practice. Those sales people who don’t strive for mastery of their jobs inevitably slide away from the discipline to do it the way the best do it. Consistent, disciplined behavior – that’s what separates the best from the rest.

To learn more about this, visit http://www.davekahle.com/bestof/topics.new.html, and consider the “Best of Dave Kahle” recorded seminars #1 Target Laser Sharp Sales Calls – A New Way to Focus for Better Results. Then, go to the Articles section of the website and read this free article: “One of the Emerging New Rules of Sales – The Value-added Sales Call.”

To study this best practice, take advantage of these resources:
How to Excel at Distributor Sales, chapter eleven 
Take Your Sales Performance Up-A-Notch, chapter thirteen 
“Best of Dave Kahle’s Phone seminars” numbers 45, 46, & 51 
“Up-A-Notch” video training kits, Module number four. 

Positive customer relationships are the basis of much B2B business, right? Positive business relationships ensure us an audience with the customer, make every step of the selling process go easier, and even provide us with a competitive edge. It’s not unusual for the business to come your way just because they like you the best.

But in today’s hyper-competitive economy, relying on your relationships is like trying to paddle through the storm in a leaky row boat – your effort will keep you afloat for a short time, but eventually you’ll find that you just don’t have enough resources to challenge the storm. Relying on your relationships is a prescription for eventual failure.

Here’s why. The world is full of, literally overrun with, business to business sales people who have built a solid business relationship with a segment of their customer base. They then rely on those relationships to support them. 

In doing that, they have missed the opportunity to develop their sales skills. “I have great relationships with my customers,” they think. “I don’t need to learn to sell well.” And, for years, that was somewhat true. 
Now, however, they are paying the price of that position. Many of their customers are seeing their businesses decline. The relationships that so many sales people counted on to support them are no longer as profitable as they once were. And, since they never spent the time and effort to improve themselves, they find themselves woefully unequipped to gain new customers, to create demand for their new products, or to persuasively gain bigger chunks of their customer’s business. Their boat is sinking, and they never gained the skills necessary to keep it afloat. The vast majority of B2B sales people have never been trained in the principles, practices and processes that are the best way to do their jobs.

Not only are they paying the price of never developing their sales competencies, they now find themselves restricted by those very relationships that were, just a few years ago, their meal tickets.

Here’s how this works. A sales person develops a set of relationships, and then settles into a routine of seeing those people on a regular basis. Those customers come to rely on him, and their purchasing patterns revolve around those regular visits. As long as they order in a sufficient quantity, life is good.

But now, those same customers aren’t filling the coffers like they used to. And the sales people find themselves boxed in. They have created expectations in their customers, and those expectations now prevent them from investing time in developing more lucrative relationships. How can they call on someone else, when doing so would mean that they can’t see their buddies as often? That would jeopardize their current relationships. And, besides, they just aren’t comfortable cold calling on prospects because they haven’t done that in years.

So, their reliance on relationships has caused them to neglect the development of their own competency, and built the walls around their comfort zones so high as to be almost insurmountable. Faced with the demands of the new economy, they find themselves woefully under equipped as sales people, and fearful of striking out of their comfort zones. Unsure what to do as they see their boat steadily sinking, they default to bailing even faster, and hope the storm goes away.

What to do – if your are a sales person in this position

Recognize that your relationships are just as likely to be an obstacle as they are an asset. The solution is for you to change. Get some education in how to excel at B2B sales. (Check my website, www.davekahle.com for lots of resources) Start working, right now, to improve your sales competencies. There are better ways to make an appointment, manage a first call, create a customer, expand the business, sell a new product, etc. Take on the mind-set that you will need to forever improve in these basic sales competencies, and start the never-ending process of improving your sales proficiency right now. Look at it as a never ending process, not an event, and start the process as soon as possible.

Then, do a cold-blooded analysis of the profitability and potential of your current relationships, and identify those who are dragging down your productivity. You’ll have to say “No” to some low-potential accounts before you have the time to invest more strategically in higher potential accounts. 
Create two lists: One list of high-potential accounts in which you want to invest more selling time, and the other list of low-potential relationships that are currently slowing down your progress. (See 10 Secrets of Time Management for Sales People for details on how to do this.)

Now, methodically work at those two lists, gradually finding a way to excuse yourself from those low-volume accounts that drain your energy and time, and invest more heavily in those higher-potential accounts.

It won’t be easy, and it won’t be quick. But, it will help you keep your boat afloat while you gain the potential to take more control of your destiny.

What to do – if you are sales manager, and recognize the plight of some of your sales people

The formula is very similar for you. However, instead of just expecting your sales people to change their behavior on their own, you need to be actively involved in the process.
Identify those sales people who are at risk of allowing their relationships to lead to their ruin. Have a heart-to-heart talk with them, and lay out a plan for their metamorphosis. Don’t be afraid to describe specific bench marks and deadlines.

Then, help your sales people get an education in the best practices of their profession. Remember, it is not an event, it is the beginning of a never-ending process (check our Kahle Way® B2B Selling System)

At the same time, work with each sales person to help him rate the potential of each account, regardless of the existing relationship, and to prioritize his time to focus more time on the high potential accounts, and less on those that drain his time and energy. 

Realize that you are embarking on a journey to help that sales person change his/her behavior, and that change doesn’t’t happen overnight. You should, however, see steady progress.

If you don’t see progress, then you may want to consider the long-term future of this sales person, and how it impacts the company’s ability to survive and prosper. ###

The latest unemployment numbers were just released, and they are depressing. National unemployment is over ten percent and my home state of Michigan leads the pack with official unemployment over 15 percent. And, everyone knows that the government numbers reflect the tightest definition of unemployment and that real unemployment is significantly greater than the government’s numbers.

All this in spite of the new administration’s promises to create three million jobs by spending far more than it had, and accumulating government debt that is multiply larger than any previous administration. We may now be the most in-debt country in the history of mankind. 

I see the impact on my clients. In many businesses, sales forces have shrunk from the size they formerly were, personal incomes are down, and principals and executives are afraid to spend money on their future.

Clearly, something isn’t working.

It’s time to take a closer look at the causes of our current malaise, and see if we can’t uncover some lessons that will help us with our personal situation.

Let’s review how we got here. As everyone knows, the direct cause of the recession was the housing bubble and the trillions of dollars of bad debt that developed during the inflation of that bubble. When it all crashed, the debts turned bad, money disappeared. Hundreds of thousands of people have lost their jobs, and countless businesses have contracted.
The most direct, observable cause of the recession was, then, the housing bubble and the bad mortgages that fueled it. 

And that housing bubble was composed of hundreds of thousands, if not millions, of people who bought houses they couldn’t afford, with mortgages sold to them by commissioned mortgage brokers who were more motivated by the commission than by the solidity of the deal.

But, to focus on that is to look only at the most superficial aspect of the problem – the behavior that caused the problem. It’s like searching for mushrooms in the middle of the forest. The mushroom that you see is just the most superficial expression of the much larger fungus that lives beneath the soil. So, too, the behavior that caused the problem was just the most superficial expression of something far larger that lies beneath the surface. Let’s look underneath the surface, below the behavior, to the emotions, attitudes and beliefs that caused that behavior.

Underlying the bad behavior was an attitude – an attitude that said we were entitled to live beyond our means, to spend more than we had, to accumulate things. The cost of all this? Our integrity. Every mortgage broker who pushed through a spurious deal to make the commission chipped away at our national storehouse of integrity. So did every home buyer who falsified an application and moved into a home he knew he couldn’t afford. So did every congressperson who lobbied the lending agencies to ignore time-tested principles and loan to people who couldn’t afford to pay it back. On and on it goes, with blame enough for countless people, all motivated by the pursuit of things we couldn’t afford.

There’s a word for that: Greed. The Bible has an additional word for it: the spirit of Mammon. That’s the unhealthy pursuit of wealth, power and riches.

Why are we in this recession? Because of a national epidemic of greed. As a nation, we allowed greed to diminish our national store of integrity.

The solution (borrowing trillions of dollars and spending it) is not a solution, but rather, a triple dose of the prescription that got us into this. Instead of just hundreds of thousands of individuals living beyond their means and spending money they don’t have, we’re going to fix that by institutionalizing it. Now, the nation as a whole is living beyond its means and spending more than it has.

No wonder the economy is so sluggish. More of a bad thing doesn’t magically turn into a good thing.

So what does this have to do with you, your job and your business? It’s time we examined our motivations and refocused on those deeper issues that ultimately impact everything we do. Ultimately, our success and prosperity are a function of our character. Character counts. 

If we want to return to a time of prosperity, let’s do it by becoming better people. Let’s work on building integrity into our business dealings and providing real service and value to our customers. 

Let’s live within our means, and not expect the government to transfer the wealth in this nation to our short term benefit. Let’s earn what we get, and not expect anyone to give us anything for nothing.

Integrity trumps the acquisition of more things. Ultimately, the measure of our existence is more deeply impacted by our characters than the things we accumulate. There is nothing wrong with prosperity, as long as it doesn’t come at the cost of our character. 

As individuals, let’s decide to work hard for our employers, to deal with integrity, to be sensitive to the needs of our customers, and to live within our means.

As leaders and business owners, let’s establish a culture of integrity and fair value, and let’s live within our means.

Let’s get back to being people and businesses motivated by a desire to serve, and defined by sound character. When hundreds of thousands of people turn from greed and living beyond their means to focusing on integrity and sound character, we will build a solid foundation for a prosperous economy. ###

A. Believe me, I can empathize with you. I had my share of whiners in my days as a sales manager. I’m thinking of one sales person in particular who complained constantly. I hated to take his calls. I even have vague recollections of hanging up on him in the middle of one of his rants.

I’m going to tell you something you don’t want to hear. It is more your problem than it is his/hers.

Before you turn off completely, let me explain. The most pertinent issue for you is that person’s sales performance. If their performance is sub-par, that’s one thing. If their performance is acceptable — their numbers are good, their relationships with their customers are positive, they generally follow your directions and do what you ask them to do – then view their whining and complaining as just so much fluff. The problem isn’t their complaining – the problem is the impact their complaining has on you!

When he complains and whines, you become upset, you become irritated, and you become exasperated. Notice any pattern here?

There are two ways to solve this problem: Either he/she can stop complaining, or you can stop reacting to it in the way that you have.

I’m assuming you have had a conversation with this person about their whining and complaining. If not, please do so. He/she may not even be aware of it.

If you’ve had the conversation, and the behavior still continues, and the person is in other ways profitable and effective, then you must change your reaction. Decide to not let the negative comments get to you. That will go along way to making this person more palatable to you.

If you are still having trouble, then I’d suggest you do a little research and find a book or two that provides you with specific techniques to deal with the emotions this person generates in you. There are a lot of resources out there.

But what if their performance is sub-par? Again, the whining and complaining may be this person’s outlet for a deeper seated understanding that their performance is not up to expectations and that maybe they don’t have what it takes to succeed in this situation.

Regardless, the whining isn’t the issue – the performance is. Focus on their performance, and put in place a specific set of expectations with quantifiable measurements and deadlines for improvement. If they don’t make acceptable progress, then it’s time to look for a new sales person.

Readers, feel free to comment on this.

That’s the subject of a series of interactive “coachinars” (coaching webinars) to be presented by Dave Kahle beginning in March.

“In this economy, companies who sell effectively have a distinct advantage. In this series of coachinars, we are going to describe exactly what you can do to improve your sales – regardless of the economy,” Kahle said.

The goal, according to Kahle, is

• to help each participating company realize increased gross profits equal to at least five times the investment in the series,
• teach the sales people important strategies and skills to gain market share
• coach the sales managers in exactly how to work with their sales people to insure implementation, and
• help instill the beginning of a sales system that will grow the business for years to come.

The name “coachinars” derives from the unique concept. Each of six webinars for sales people will be followed, four days later, by six corresponding webinars for sales managers, describing exactly how to coach the sales people through the practices presented.

The webinar technology allows people to participate in these interactive seminars from your office, with no need to travel. All that’s necessary is a computer with broad band access. The per-site fee makes it extremely economical.

Kahle is a consultant and sales trainer who is a frequent association speaker and the author of seven books on sales and sales management. His Thinking about Sales Ezine is received by 30,000 people each week.

For more information, visit www.davekahle.com/sales_webinars.html , or call 800-331-1287.

The best salespeople earn that designation because they write more business than the mass of salespeople. They get the order!

One of the practices that contributes to that success is that of “closing the sale”. Unfortunately, there is no one issue that is more misunderstood and incompetently trained than that of “closing the sale.” Much of the sales training on the subject, as well as the vast preponderance of sales literature, is way off the mark.

Closing is not a matter of continually pressing for the business, nor using manipulative techniques, nor clever repartee, nor memorizing any “magic” closes.

Just today I said “no” to someone who kept pressing me for the order. I interpreted his pressure as desperation on his part, and his desperation meant that there was something not right about the deal. I said “no.” In this case, the highly trained, very skilled salesperson, with the right product at the right price, did exactly the wrong thing, and brought about a negative result — solely on the basis of his poor judgment about the customer, and his repeated attempts to close the sale.

While there isn’t enough space in this article to fully explore the issue of closing, I have some general observations.

When it comes to closing, the best salespeople do two things. In the traditional sense, they ask for the order when they sense that the customer is close to committing to a decision. This has always been the classic definition of closing the sale.

But in the hands of a master, closing takes on a larger meaning. Sales masters also understand that “closing” is more than an event that gets tagged onto the tail end of the sales process. They understand that “closing” is the process of attaining an agreement with the customer on the action that the customer will take as a result of every interaction. They have the mindset that every sales call – whether 45 seconds on the phone, or 90 minutes in the customer’s office – always should end with some agreement on the next step.

The process of closing, then, starts with the first “Hello” and continues through every interaction that the salesperson has with the customer.

So, confirming an appointment is a mode of closing. As is gaining a commitment to view a presentation, test a sample, research other users, etc. The best salespeople continually seek, and obtain, commitment from the customer to take action at every step along the way.

As a result, the final decision to buy the product or service is a natural, logical result of all the commitments (closes) that went before.

The best salespeople are continually and effectively closing every conversation with the customer. That’s why this is a best practice of the best salespeople.

To study this best practice, take advantage of these resources:
How to Excel at Distributor Sales, chapter eleven
Take Your Sales Performance Up-A-Notch, chapter thirteen
“Best of Dave Kahle’s Phone seminars” numbers 45, 46, & 51
“Up-A-Notch” video training kits, Module number four.

By Dave Kahle
Copyright MMIX

Excerpted from Take Your Sales Performance Up a Notch, by Dave Kahle

As sales people, we love to complain about the competition. Unfortunately, complaining doesn’t do us any good. A better approach is to create a system to learn about the competition. Knowledge of the competition — not only their strengths and weaknesses but also their patterns and tendencies – will provide you with a distinct advantage, and prevent you from getting blindsided or seriously outmaneuvered.

That happened to me. To this day, I still get a sick feeling in my stomach as I remember the day when I lost my largest account to my arch competitor. It was an account that made up 20% of my total volume. In my blissful ignorance, I was content to grow my business by calling on the end users and purchasing department, while my competition was successfully building a relationship with the administration. The result? My best account signed a prime vendor, sole-source agreement with my competitor, and within 60 days, I was almost totally out of that account. I was blindsided.

That’s a lesson that sticks with me, and one from which you can learn. To become good at knowing what your competition is up to, implement this simple three-step process:

Step One. Collect bits and pieces of information

Begin by consciously collecting little bits and pieces of information at every opportunity. For example, you may have lost a bid or a particular piece of business to your competitors. Rather than just moping about it, use it as a learning opportunity. Try to find out from your customer why they awarded the business the way they did. If it was price alone, try to find out how much lower their price was than your price. If it’s something else, find out what. That information won’t help for that particular piece of business, but it may give you an insight into the pricing policies of your competition. Write the information down on a 3 x 5 card, a piece of scrap paper or a post-it.

Take your good customers to lunch, and casually see if you can steer the conversation in such a way as to learn something about your competition.

Keep your eyes open to the coming and going of competitive salesmen. Note when you see them, and in what account.

Be sensitive and aware of competitive literature, business cards and price quotes lying around. And don’t forget to talk with the other sales people who work for your company to get their insights.

All these are ways to collect bits and pieces of information. By themselves, they won’t help much. But, if you combine these bits and pieces, you may very well see trends, uncover strategies, and discover tactics your competition is using.

Step Two. Store the information.

As you collect each bit of information, capture it by writing it down, and putting the note in a manila folder marked “competition.” Or, store it in an electronic file on your computer. You may even have a separate folder for each major competitor.

Regardless, what you’re doing is assembling a quantity of information. Diligently collect those bits and pieces of information, and file them away.

Step Three. Use the information.

After you have collected a quantity of these, you’ll be able to open that file on a regular basis, consider all the pieces of information, and discover a great deal about your competitors.

The trick is to consistently collect and store information. Eventually you’ll assemble an accurate picture. It’s like the popular game show "Wheel of Fortune." When Vanna White turns over one letter, it doesn’t give you much of a picture of the answer. But after she’s turned over several of these small individual pieces, the whole becomes clear and the answer to the riddle is simple to understand. That’s the way collecting information about your competition works.

The back of an old business card on which you noted that you saw a competitive sales person showing a new line of widgets, by itself, doesn’t mean much. But if you filed that along with all the bits and pieces of information you’ve collected, and then pulled it all out and analyzed it, you might see an entirely different situation. Suppose you reviewed that business card note, and combined it with the note you made to yourself that you saw some sales literature on the competitive widget line on the desk of one of your purchasing agents, and then saw that you lost a major bid to the competition because he quoted a new line at lower than traditional prices. All at once you’ve uncovered a potential threat to your business. Clearly, your competitor is pushing a new, lower priced widget line. You didn’t learn that from any one piece of information, but rather from the combination of all those pieces, considered as a whole.

The key to uncovering that information, to discovering what your competition is up to, is to consistently collect pieces of information, store them, and then analyze them as a whole from time to time.

In the Information Age economy, much of your ability to make good decisions depends on you being able to collect good information. If you are going to take your performance Up-a-Notch, you must see yourself as a dealer in information as well as a seller of stuff. An important initial step is to get good at collecting good information.

About the Author Dave Kahle has trained tens of thousands of B2B salespeople and sales managers to be more effective in the 21st Century economy. He’s authored seven books, and presented in 47 states and seven countries. Visit his website or sign up for his Ezine .

By Dave Kahle

"Low price, low price, low price." It’s the mantra that sales people in every industry segment are hearing more these days than ever before. Customers, looking for ways to contain costs, naturally pressure their vendors for lower costs.

But, is low price the motivating factor in a customer’s decision to buy?

In every survey of buying motivations I’ve ever read, low price is never the primary motivation. Yes, it’s important. And, when everything else is equal, it will be the deciding factor. But very rarely is everything else equal. And very few people in this world buy only on the basis of low price. How many of you are wearing a suit you bought at a garage sale? Or watching a 12-inch black & white TV?

If low price were the only motivator, you would have gone with those lower priced options. But, you don’t always buy on the basis of low price, so why should you think that all your customers do?

The truth is, they don’t. And here’s a secret that almost nobody knows, including all those gurus telling you to sell value. They don’t always buy the best value. But, they can invariably be counted on to buy the lowest risk!

The biggest issue in the minds of your customers and prospects is not price, and it is not value – it is risk.

What’s risk?

It is the potential cost to the individual customer if he/she makes a mistake. It’s not just the money, although that is part of it. It is also the social, psychological and emotional cost that your customer will pay if your choice isn’t the best one. The lower the risk of the decision, the more likely your customer will say yes to you – regardless of the price.

Let’s become comfortable with this concept of risk first, and then discuss how to use it in your sales efforts.

In order to really understand risk, you must first see this issue from your customers’ perspective. Try to put yourself in their shoes, and calculate the amount of risk that you expect your customers to take when you offer them an opportunity to say "yes" to you.

Here’s an illustration to help you understand this concept. Imagine that you are under orders by your spouse to pick up a package of disposable cups on the way home from work today because you’re having friends over for a casual evening of dessert and drinks tonight. You stop at the local grocery store, and make a selection between brand A and brand B. You pick brand A.

What happens to you in this instant in time? What is the consequence of your decision? I don’t know about you, but I would be the recipient of some negative emotion. My spouse would be upset with me. That may be the most painful cost of your decision. But there are other costs.

You’re going to have to fix the problem. If there’s time, you’ll have to run back to the store and replace the cups. So, in addition to the emotional cost, you must also pay in terms of extra time and additional money. All because of your bad decision. Those costs — negative emotions, time wasted, extra money spent – all combine to form the risk you accepted when you made your decision.

Here’s a simple exercise to help you understand this concept. Draw a short vertical line. At the top of the line, write the number 25. At the bottom, write the number zero. Now on a scale of 0 to 25, with 0 being low, and 25 high, where would you put the risk of buying a package of disposable cups? You’d probably say it is close to zero. So, put an X on the line from 0 to 25 where you think the risk of buying those cups would be.

Let’s look at an illustration at the other end of the scale. I once had an adoption agency as a client. When a young lady is in a crisis pregnancy, and she’s making a decision as to whether or not to release her unborn child for adoption, how big a risk is that for her? Put your X on the line that represents your assessment of that risk.

Most people put their mark around 25. The risk in this situation is a lifetime of consequences for at least four people – the mother, child and adoptive parents. That’s a very high risk. Compare the X’s for the two different decisions, and you’ll conclude that different decisions carry with them differing degrees of risk.

Now, let’s apply this concept to your customers. Remember that every time you ask your prospects to say yes to you, they are accepting some risk. And each of those decisions you ask of them carries with it a different degree of risk.

Imagine your typical customer. Then think of the typical offer or decision you ask of that person. For example, take one of your newer products. Imagine you are presenting it to your customer for the first time. Now, put yourself in his shoes, and see the situation through his eyes. On the 0 – 25 scale, how much risk does your customer accept when he says “yes” to you?

For an easy way of calculating it, just ask yourself what happens to that individual if you, or your company, or your product, doesn’t do what you promise?

If your customer buys that product and it doesn’t do what you claim it will, what trouble will that make for your customer? What consequences will he/she pay? What is the risk?

And don’t say that there is no risk because you’ll take care of any problem that might develop. You may think that, but your customer doesn’t know that. And remember, you’re trying to see this from your customer’s point of view, not yours. The amount of risk is what your customer perceives it to be.

I had a great example of the role of risk in sales several years ago. A young man approached me to help his company with their sales efforts. They were selling a product that was, at the time, a real state-of-the-art breakthrough. The company designed computerized controls that were retrofitted on food processing equipment. As a result of the use of these controls, the savings in energy consumption would pay for the cost of the equipment in less than a year.

It looked like a great product. But he couldn’t sell them as rapidly as the company wanted.

"Tell me how you go about selling them" I asked.

"We qualify our prospects to the point where we know we have someone who could use the equipment. Then I call the production engineer or the plant manager on the phone, and gather some information about the type of equipment they use. Then I create a written proposal showing the economic payback, and mail it to him. Next I call and try to close the sale."

"Let me see if I understand correctly," I said. "You’re calling a plant manager on the phone. I would guess that most plant managers are men in their 50’s, probably with advanced degrees, and who have been in the plant for a number of years, is that right?"

"That’s right."

"OK," I said. "So, you’re calling someone twice your age, asking him to spend $30,000 – $40,000 on equipment he’s never seen, from a company he’s never heard of, and from a sales person half his age who he’s never met. Is that right?"

My client became a little defensive. "If you put it that way, I suppose its right."

"Well put it that way," I replied, "because that’s the way he sees it."

The problem was simple – risk. On that scale of 0 – 25, how much risk would you think the plant manager would be accepting if he said “Yes” to the over-the-phone offer?

Put yourself in his shoes. Suppose the equipment didn’t work the way it was supposed to? He could shut down production lines, spend weeks trying to make things right, cause all sorts of havoc in the plant, and potentially even lose his job. Now that’s risk.

If you were that plant manager, how much more than the original $30,000 quote would you spend to reduce the risk? It wouldn’t be hard to justify a price double that.

That should give you a clue as to how to fight the “low price” issue. Worry less about low price, and more about lowering the risk.

Here are four strategies to do so.

1. Build solid, deep relationships with the key decision-makers. Relationships mitigate risk. The greater the relationship, the lower the perceived risk. That’s why the salesman with the longer relationship almost always has the benefit of the doubt in a competitive situation. It is not the price – it is the risk.

2. Make ample use of third party recommendations, customer lists, case studies and testimonials. All of these say to the customer that someone else, or lots of other people, have used the product or service. That means it is less risk for your customer to buy it.

3. Try to get your customer as physically involved with the product as possible. For example, if you’re selling a piece of equipment, try to get the customer to trial the equipment, or at least visit somewhere its being used. The more your customer can see and feel the actual thing, the less risk is it to them.

4. Finally, work with your company to create offers that reduce the risk. Trial periods, money-back guarantees, delayed billing, warranties, service desks – all of these reduce your customer’s perception of risk.

The winners in the competitive selling arena of our difficult economy are those who are the low risk providers, not the low price people.

About the Author Dave Kahle has trained tens of thousands of B2B salespeople and sales managers to be more effective in the 21st Century economy. He’s authored seven books, and presented in 47 states and seven countries. Visit his website or sign up for his Ezine .