Q.
Dan, I work for a major technology company. I would like your guidance on a big deal for one of my key
major accounts.
The rep who was previously responsible for the account did something to upset this customer. Until recently, the customer has refused to consider any of our products or services.
There is good news: the customer recently hired a new CIO to do a "tech refresh" which will include a multi-million dollar purchase for their main headquarters campus.
Last week I received the customer's written request for bid. The cover letter outlined a very strict process which includes a communication lock down. I am not allowed to communicate with anyone in the account.
I am busy putting together the team from our headquarters to respond to this bid, but I would like your thoughts. How aggressive we should be on pricing? I have four different pricing discounts that I can offer ranging from small to super-aggressive. Please help! If I win this one deal I will make my quota for the year.
Ann
Dallas, TX
A. Ann, thank you for your great question. I have some important advice for you that you may not want to hear, but that will help hone your skills as a Sales Superstar. You need to review this before you rally your troops to work overtime responding to the bid and definitely before you spend that commission money. Your immediate focus on price reduction is also a major concern.
First, let me start by assuming that this account is NOT a government agency, because federal, state and local government procurement processes require a slightly different approach to working with formal bids.
Whenever you receive a bid request there are a number of key questions that you and your manager should review in order to determine your strategy. Let me play the role of your manager and ask you those questions. Your answers will be in CAPS below.
- Did you write or heavily influence these bid specifications? NO.
- Was this bid request a surprise or were you aware of this bid well in advance of receiving it? IT WAS A SURPRISE.
- Do you know what the client's budget is for this project? NO.
- Do you know who the key decision maker is? I'M NOT SURE BUT I THINK IT IS THE NEW CIO.
- Have you met the new CIO? NO.
- Do you know what the customer's buying process is? NO.
- Is there a critical event that is driving this decision? If yes, what is it and when is it? I DON'T KNOW. THE BID DOCUMENT STATED THAT THE DECISION WILL BE MADE WITHIN 3 WEEKS.
- Do you know what the key decision criteria are for this project? THE BID DOCUMENT INDICATED THAT PRICE WAS IMPORTANT.
- Who are your key competitors and what is their strategy? I DON'T KNOW.
- Do you know specifically why your company has not done business with this client in the past and has anything changed to improve that situation? NO.
And the most important question:
Have you built trust with the key decision makers? NO
Just think about it for a few minutes. What are your chances of winning a major deal where you did not write or influence the bid specs, have not met the decision maker or her key decision criteria, don't know the budget, don't know your competitors strategy, have no clue of their buying process, have no trust and you have 15 business days until a decision is made. Let me tell you what you don't want to admit--you have ZERO chance of winning this opportunity. In fact, forget about your pricing question, you could not give this away to them.
But let's say I am wrong and somehow you do win the deal. If I were you or your manager, I would be very disappointed and worried. Why would I lose sleep over a big win like this one? Well, you have no trust or relationship with them. You have no idea of how they define success for this project. You have no idea of their current or future business requirements and needs. What are the chances that your solution will make them successful? The answer is ZERO! You then will be faced with a major customer who, thanks to social media, could seriously damage your reputation. This is totally unacceptable.
You must live by the following premise, as do all Sales Superstars (tattoo it on your arm if necessary):
"PRESCRIPTION BEFORE DIAGNOSIS IS MALPRACTICE."
-Unknown
If you place all of your responses above into the Sales Strategizer, you will be advised that your strategy should be to Disengage. The tactics you will use to support this strategy will be a phone call and a Respond to Unsolicited Bid Letter.
So here is specifically how you should proceed.
Step One:
PHONE FIRST. Do not sent the powerful Respond to Unsolicited Bid Letter until you have phoned the account first. You should call the account and verbally share with them what is in your Letter. If your call is not returned, leave a professional voice mail which summarizes exactly what is stated in the Respond To Unsolicited Bid Letter.
Wait two business days for your customer to respond to your call. Your hope is that you do not have to send the formal Respond to Unsolicited Bid Letter because your customer will have agreed to let you meet with the key executives in control of this project. At this important meeting, you will be able to qualify (diagnose) this opportunity, uncover the executives' definition of project success while discovering current and future business needs. If you do not receive a response to your phone call, then consider step two.
Step Two:
Send the Respond to Unsolicited Bid Letter to all the key project participants. Send it via express mail; this will give your letter an added level of exposure and importance.
SAMPLE: Response to Unsolicited Bid Letter
(Date)
Mr. Mark Crane
(Insert Title)
ABC Corporation
(Insert Address)
Dear Mark:
Thank you for inviting us to submit a formal bid on your (insert project). We appreciate your confidence in us.
Our policy is not to respond to Request for Quotations (RFQ's) until we have had an opportunity to personally interview the senior business leaders who will be impacted by the scope of the project. We have found that our client is the main beneficiary of this policy because it results in a high quality implementation which meets both your current and future needs.
If you would like to arrange a meeting for us with (Insert Key Executives) we will be happy to invest the time and resources necessary to complete the RFQ to your satisfaction.
Again, thank you for the opportunity to grow the (insert your company) / (insert their company) relationship in the future.
Sincerely,
Jane Smith
Sales Consultant
Many readers may say, "But Dan, if we send this letter we will not even have a chance to win this big deal." Well, I'm sorry to say this, but based upon your earlier responses to my questions you never had a chance to win this deal in the first place. Your scarce resources and the scarce resources of your company are MUCH better spent working with other accounts to prevent this situation in the future.
Also, you will be shocked at how often this strategy actually works. Your letter of phone call can actually open the door for you to meet the key executives and do proper discovery. Only in this case can you be sure you can actually help them. You will uncover how your clients define success for this project and really understand their business requirements, goals and needs. It is only then that you can customize a solution at a price that serves everyone's best interests.
One final key point. This is a very advances sales strategy and approach. If you are an individual contributor sales representative you DO NOT have the authority to deploy this approach alone. You must get agreement from your sales leader.
All the best,
