Teaching Your Customers How To Negotiate With You.

Every selling organization that has been in business for a while has taught their customers how and when to do new business with them.

We focus hard on learning the customer's organization, how it works, who are the influencers, who has the buying authority, what are their hot buttons, how are they evaluated, etc. It is important to be aware that while we are busy learning to "sell the way the customer buys," they are learning how to work their suppliers for their advantage.

Most sales managers have told their customer service reps that if the customer is really angry, "give them whatever it takes to make them happy". What have we just taught our customers? We have taught them to get really angry!

Every sales manager complains that the salespeople give away too much profit as the end of a quota period approaches. This happens for two reasons. One is the need to book all the business we can to raise the backlog prior to the quarterly or year-end report. The second is to help the members of the sales force make their quota. So, what have we taught our customers? We have taught them to hold off on large orders, when they can, until close to the end of our fiscal year or the end of a quota period. Customers learn to hold large negotiations until the time we need their business the most.

Individual sales people have taught customers to nibble hard on little value issues just before awarding the big order. As long as the customer continues to get things or service items for free, what have we taught them? We have taught them to keep the negotiation open for longer than necessary because "freebees" keep flowing in their direction.

What should we be teaching our customers?

• Our product is always fairly priced
• We perform more than we promise
• Your cost of doing business is reduced by doing business with us
• It is easy to business with us
• When the customer wants something extra, or a change, there will be a well documented and justifiable charge
• Our goal is to profitably help our customers succeed
• We will never cut the price of a high quality product to match the price of a poor competitor
• We will lose orders based on price, but not on value
  
• At some price we want the competitor to take the order. As a matter of business judgment, we want the competitor to fill their capacity with low margin business.

Jim Sauerwein