One of the best things about business development is that every day brings new scenarios and often, unexpected outcomes. Here are two such “stories from the trenches” that still make my blood pressure fluctuate when I think about them. As a Holiday bonus for your account executives (part of our second story), I have outlined a perfect closing technique that is applicable to many industries.
Story #1 – Nice berries!
Five years ago, it started out like any other day, but what I learned that day changed the way I did business, right up until our company was sold in January of 2017.
I was scheduled to meet with an angry group of 25-year-old decision makers at a famous media company in Beverly Hills. I did not know why they were angry. The sales were huge (30K a month – 500 employees) and the service (daily) was excellent, but they had just sent us a terse notice of cancellation.
I figured the problem was one or more of the following:
- The client needed a special product and someone told them we couldn’t supply it.
- A competitor offered them some serious low-ball pricing.
- We were blowing up the budget and the facility group was getting into trouble.
Do these problems sound familiar?
Quite a problem
When I arrived, I asked to see the kitchens, to check out the amenities that we were providing:
- Coffee Service and Supplies
- Packaged Snacks
- Water Systems
Everything looked great, but what really caught my eye was the two giant glass bowls of fresh raspberries and blueberries – perfectly washed, ready for consumption in multiple kitchens.
“The local Bristol Farms store brings them in every day,” explained the facility manager, when I asked about the berries. “It’s expensive, but it’s one of those things that you can’t stop providing once you start offering it.”
I suddenly knew why they were angry and wanted to cancel.
It wasn’t the service.
It wasn’t the pricing.
We were just not selling them enough.
By the time I left that meeting, the client and I agreed that my company would provide just about anything I could think of, some of which we had never sold before.
- Fresh fruit delivery
- Third Wave Coffee
- A wide variety of dairy, from yogurt to milk
- Ice cream and yogurt bars
- Fresh veggies in portion packs
- High end ice dispensers/water units
- A vastly expanded selection of premium snacks and “New Age” Beverages
All of this was billable to the client and free to their employees.
Yes, it was a challenge for the operations side of our business, but by the time everything was in place, sales jumped to the $65,000 a month range.
Lesson One: Be on offense always. Don’t take the safe, status quo, defensive approach to serving your accounts. Once you let up, once you stop delivering fresh ideas, your competition will swoop in.
Lesson Two: Don’t always assume the worst-case scenario. You can fix things if they are broken. Admittedly, that is a lesson I keep learning repeatedly, even today.
I should add that the number one reason for keeping the business was the fact that we had a contract. They were “angry” because they had signed a contract – but that was the reason we kept the business and I never apologize for having a contract. You can read about that in a January column.
Story #2 - A slam dunk!
About a year later, one of my best account execs learned a hard lesson about the mindset of some prospects who are more worried about their own image than anything else.
Our account exec was working on landing a 100-employee production studio in West Los Angeles. Our competitor’s service was terrible, which is why she was able to get a meeting. She convinced the office manager to turn over months of invoices for review prior to her proposal (yes, she is that good).
What we saw on those invoices was astonishing.
- $20,000 a month for coffee service and some basic beverages
- Huge service charges
- Brutally high equipment rentals
- An ongoing history of price increases
- A pricing structure that was about as high as it could be
Clearly, the office manager, her team, the purchasing manager and the accounting department at the studio had all been asleep at the wheel for two years. Our competitor was either consciously or unconsciously gouging the studio month after month.
35% savings – When do we install?
Our account exec gave a dazzling presentation. By pricing the account within a more acceptable, but still highly profitable range, our proposal would save the studio $7,000 a month – a 35 percent savings. Over the past two years, the studio had blown about $170,000 because they failed to pay attention.
Great closing technique
Following the presentation to the clearly stunned office manager, our skillful account executive moved in for the easy close. (Note - Here is a free closing lesson to pass on to your reps.)
Account Exec: “In our first meeting, you indicated that if I could improve your service, improve the quality of the products and save your studio significant dollars, you would move forward with our company. Based on our summary, is there any area where we fell short on meeting those objectives?”
Office Manager: “No, you clearly met those objectives.”
Account Exec: “Excellent. Based on everything we have seen here today, would you prefer that we install our equipment - first thing in the morning, on Tuesday the 14th or Wednesday the 15th?”
Office Manager: “Actually, I still need to review the numbers with accounting and get their approval.”
Account Exec: “OK – but since we are saving you 35 percent, can you see any reason accounting would not urge you to move forward?”
Office Manager: “Not really, but I have to get their final approval.”
Account Exec: “Great. Let’s set a tentative installation for the 14th and as soon as you get final approval, we will be ready to install on that date.”
The office manager agreed, and my account executive returned to the office triumphant, but somewhat perplexed about why she didn’t have final approval. “It’s a slam dunk,” she said. “The office manager hates our competitor and the savings are off the charts.”
She heard nothing but crickets
Days passed. The office manager at the studio was unreachable and the 14th came and went. Our account executive was not ready to give up. She finally reached the office manager and he explained why, to her amazement, the studio would not move forward with our company:
“The 35 percent savings was a little too good,” he said. “Ten or fifteen percent savings would be fine, but 35 percent makes us all look bad for what has happened here over the past couple of years.”
He explained that the existing vendor dropped his price 15 percent and would be keeping the business.
Who can predict this type of outcome? While it can be tortuous, it is these unexpected outcomes that make selling so exciting, so interesting and so challenging. The lesson that our account executive learned: “There is no such thing as a slam dunk.”
For those of us who sell – it is a lesson we learn again and again.
I welcome your feedback - Cell 818 261-1758 - [email protected]
Visit the website - www.tullioB2B.com
Over the last 37 years, Bob has sold video games, cigarette machines, cranes and juke boxes to bars and amusement centers, full line vending to public locations and office environments, pay telephones to retailers, coffee service to thousands of office locations and of course, micro-markets. He has a very successful track record as key strategist, sales trainer and media manager under the title, "Director of Business Development" for World Wide Vending and Gourmet Coffee Service.