For many salespeople when they are asked for a quote it is as good as a prospect uttering the follow on words, “… so I can give you an order!” And yet, that isn’t what the prospect said; they only asked for the salesperson to give them a quote.
There are a number of reasons why people ask for quotations including:
- Because they have recognised they have a need and require a solution
- Because they are planning for the future and think they may, perhaps need a solution in time
- Because they are looking for a competitive price against a preferred supplier (where they have already been in conversation for some time – and in most cases have already made their decision to buy from that preferred supplier)
- Because they are curious (“What would it cost us if we were to do/use something differently?”)
- Because they are validating their existence in their company (“Look boss – I am busy!”)
In cases 1 and 2 it is right to issue a proposal and to do it well, although we need to be careful on situation 2 that we don’t give too much information too quickly (timing can be critical!) In cases 3-5 the chances are that we can end-up wasting our time and effort as the return we will get will be minimal, if indeed there is a return at all.
The good news is that through effective questioning we can identify the difference between the two groups of quotation request. In the first group (1-2) the people we are dealing with should be able and willing to answer our questions. We should be able to tell that when they don’t or can’t give us an answer it is only because they don’t know it. In this case we can work with them to find somebody who does know. If they are genuinely interested in working with us they will go the extra mile to get us the help we need to get the information. If they are not communicative however, don’t look for help to get the information (even when we request it) or simply refuse to help us then we should already have a gut feeling that this isn’t a good situation and we are in the second group of requests (3-5). Whilst sometimes these may still turn into orders (I imagine we can all name a few over the years we have been selling) we would be fooling only ourselves if we thought this was going to happen most of the time; such cases are exceptions.
For those of us who measure quote:order ratios those figures will typically tell us that a certain percentage of our proposals / quotes (i.e. 3 out of every 4) raised don’t become orders. We will be able to see that some of what we quoted have become orders (we won), certain became orders for our competition (we lost) whilst others will be unaccounted for (neither won or lost). If we haven’t lost them or won them there is a good chance a large proportion of these are the second group of request types and there never was an order to be won in the first place, despite it looking like an opportunity at first glance.
Where we believe (using questions) we have a genuine opportunity, that the request for quotation is real and that an order will be placed our job is now to understand what will motivate the prospect to buy and to understand it fully. We need to know what they currently have, do and/or use and what it costs them (i.e. time, people, resource, missed opportunity to do other more valuable things, etc…). We also need to understand how having our solution (product/service) will benefit them (i.e. gained time, freeing up of labour, increases in profitability, easier life, etc…), and in both cases we need to put numbers against them and put it all in offer (this is what distinguishes it as a proposal rather than a quote which is mainly just a specification and price). Only then can we build a compelling business case which will motivate a prospect to decide that in spending any money, our proposal is the most compelling one and the one that offers the best potential of return on investment. Simply put, if we read through our proposal once we have drafted it and it ‘blows our socks off’ the chances are it will for our prospects also. If it doesn’t even ‘make our skirt flap in the breeze’ … they won’t be motivated either! We simply then have to amend this where possible and make it more compelling before submitting it. Without justification, what we are currently submitting is still more of a quotation – just by another name. It is figures; justification by means of a defined return on investment that makes it a genuine proposal and gives us the best chance of success.
One thing we must remember to do though is stress our uniqueness in doing so. Whether that be the products / services we offer, the service and support we offer to look after them once they have chosen to work with us or the experience / relationship we will have together there must be a differentiator. Something must convey that not only is the solution we are proposing the right one but we must also underline that buying from us is the only place where they can get all of that good stuff! Miss this out and we are opening our compelling sales argument to whoever else can offer something similar and in such cases the vendor with the lowest price is likely to be the winner. If that isn’t us then we leave ourselves exposed to a high risk of losing, even where we sold it!