Download - uccessful Selling In a Comatose Economy
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Successful Selling in a Comatose Economy19th April 2012
Welcome
price at the moment of truth
Achieving the Optimum Price
Selling by Value Based Pricing
Copyright Margin2 2012
price at the moment of truth
Why is Pricing so important?
Those companies that ‘achieved true excellence in their price execution capabilities . . . earned operating profits 24% higher than their industry peers’
Hogan 2011
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price at the moment of truth
The moment of truth
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PriceValue
The price you offer is therefore
fundamental to your customers
value calculation, it’s a moment of
truth where theory becomes practice
Every purchase is therefore a balance between the price offered and the value
delivered, there is the constant risk of losing the sale or missing out on vital profit.
In every sale, the buyer makes a
mental or physical calculation of the
value they will gain from making a
purchase
price at the moment of truth
So, if its about ‘Value’, what does that mean?
• Its judged in unquantifiable terms
• It is judged from a range of perspectives
• It is always placed in the context of today’s sale
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price at the moment of truth
Equation for Customer Value
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PriceValue
Benefit
Risk
Effort
=
-
-
price at the moment of truth
Types of Customer Benefit
Price Sensitivity
Service Level
Functional Uniqueness &ability to meet
consumer needs
Economic Commodities
with pricebased appeal
Intangible Image, brand,
unique experience
+
+
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‘They are 10% cheaper’
‘They always deliver on time’
‘I like doing business with them’
price at the moment of truth
Market Mapping – Price per Feature
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10 15 20 25 30 350
50
100
150
200
250
300
Number of Features
£ pe
r Yea
r
= Supplier A
= Supplier B = Supplier D
= Supplier C = Supplier E
= Supplier F
price at the moment of truth
How to Sell at the Right Price
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Volume Turnover
ProfitCosts
Price =
=
x
-
Turnover is Vanity, Profit is Sanity
price at the moment of truth
Turnover growth does not automatically mean Profit growth
Copyright Margin2 2012 Source: Companies House
price at the moment of truth
2 Rules for Value based selling
• Facts are far more useful than opinions
• What gets measured gets controlled
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price at the moment of truth
‘Experience’ and ‘Judgement’ is always subjective and never as impactful as performance reviews and
customer research
Resp. A Resp. B Resp. C Resp. D Resp. E Resp. F4.50
4.60
4.70
4.80
4.90
5.00
5.10
5.20
5.30
5.40
5.50
What Interest Rate would you offer on this Deal?
%
10% difference in price and a 70% difference in profit between the highest and lowest
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price at the moment of truth
Gross Profit Tooling Sales Tooling Costs Rebates Other Discounts
Late Payment Stockholding Carriage Cost True Profit0
200000
400000
600000
800000
1000000
1200000
1400000
1600000
Profit Waterfall – Industrial Component Distributor
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Decisions made by Sales often impact profitability, Profit Waterfalls identify the hidden discounts that undermine profitability
23.94%27.86%
price at the moment of truth
Measure and create sales targets to measure efficiency and effectiveness
‘Lead’ Measures
Indicators of sales effort or efficiency
For Example:• CRM data• Number of customer meetings• Number of proposals made
‘Lag’ Measures
Indicators of results or effectiveness
For Example:• Sales turnover• True profit by customer• Price secured
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price at the moment of truth
In Summary,
• Pricing about understanding what your Customers are willing to pay
• Facts are far more useful than opinions, ultimately its always about profit
• Measurement makes results more visible and decisions more informed
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price at the moment of truth
Thank you
Copyright Margin2 2012
The Chamber of Commercefor Sussex
www.sussexenterprise.co.uk
Membership
10 min Networking Break
David Foster Associates Ltd
3 ways to help you RECRUIT, DEVELOP and RETAIN the right sales people who can MAXIMISE UPON PROFITABLE SALES opportunities
for your business !
Recruit, Develop and Retain
Please stand up if you are a sales rep ?
Please stand up if you are a salesman/ lady ?
Please stand up if you are responsible for bringing in new accounts to your business and/ or managing existing customers?
Sales is not a dirty word !
The Moment of Truth!
YES or NO?
Are Sales People Born or Made?
The Surgeon?
The Pilot?
Without sales / incoming revenue, do you have a business ?
Selling is a Highly Skilled Profession!
Is it important that the whole sales process is ethical, non pressurised , not aggressive ?
What is it that makes a good Sales Person?What is it that makes a good Sales Person?
What is it that makes a good Sales Person?Personality?
Appearance?
Characteristics?
Persistent Goal setter and achiever Excellent communication skills A good listener Passionate and enthusiastic Knowledgeable Take responsibility Work hard
How About …. ?
Courageous Rapport builders Modest Curious Resilient Persuasive High self esteem and belief Confident
How About …. ?
Dependable Trust worthy Intelligent Likeable Sense of urgencyLike people Sell value The list goes on and on and ....................
How About …. ?
Identify the right type of sales person for your business !?
Consider the sales process within your industry, eg time line, frequency, decision making process and unit, average order value, retention, the competition, sale targets and expectations ( KPIs)
Way Number 2
Hunter
What type of Sales Person do you want?
Hunter Farmer
What type of Sales Person do you want?
Hunter Farmer Order takerProblem solver Relationship builder CloserConsultative Expert Account manager
What type of Sales Person do you want?
Have a specific and detailed job description PLUS a fully completed “Person Specification”
Make sure you don’t take on a “square peg and try to push it into a round hole”!
The Recruitment Stage
You now have the right sales person in position Now its time to make sure they are successful and stay !
Way Number 3
Give a man a fish and you feed him for a day, teach a man to fish and you can feed him for a life time !
Train and coach for success and retention
Gone Fishing
The way and method to make the PROSPECTS / CUSTOMERS buying and purchasing journey and experience a pleasant one :
One where the final destination is to become a customer of yours
One which they will want to make again
A journey they would recommend to others
The Consultative Sales Approach
Consultative selling is a move towards more collaboration with, and involvement from, the prospect/ customer in the selling process. Strongly based on questioning aimed at gaining useful information, whereby issues/ challenges (objections) raised can be solved and a solution found and agreed by the customer. Consultants help people achieve their wants and needs. It is a non pressure selling style
The Consultative Sales Approach
Prospecting/lead identification & qualification Telemarketing / appointment makingRapport building Listening skills Need analysis Benefit selling Closing To name but a few !
Consultative Selling Includes
3 ways to help you RECRUIT, DEVELOP and RETAIN the right sales people who can MAXIMISE UPON PROFITABLE SALES opportunities for your business !
Recruit, Develop and Retain
Have a more in-depth understanding of what makes a good sale person
Look at the personal attributes and skills needed
Way Number 1
Identify the right type of sales person for your business !?
Consider the sales process within your industry, eg time line, frequency, decision making process and unit, average order value, retention, the competition, sale targets and expectations ( KPIs)
Way Number 2
You now have the right sales person in position Now its time to make sure they are successful and stay !
Train, coach and motivate them towards success
Way Number 3
David Foster Associates Ltd
Hot off the press !
The details
The promotion
The booking
A New Training Course Available