Empowering Box Two with Added Value

Box Two managers have a simple set of needs:

  1. They want money.

  2. They want money now—yesterday would have been even better.

  3. They want money so that they can make more money with it.

In order to position yourself for Consultative Selling, you must be able to prove to customer managers that you can help them get their hands on money, that you can help them to get it soon, and that you can supply them with a steady stream of investment opportunities that will enable them to make more money. These are the empowering features and benefits that will make you compellingly partnerable.

As your products and services become more closely replicated by competition, their features and benefits can no longer be differentiated enough to command a premium price. This places the burden of differentiation on you. Can you help customer managers make or save more money than your competitors can? Can you help them make or save it faster? Can you make them more certain by working with you? Yes answers are your sole competitive advantage because they provide the sole competitive advantage of your customer managers.

Vendors sell by asking purchasing managers at the Box Three level to let the sellers do their job: "Buy from me." Consultants sell by helping their Box Two partners do their own jobs better: "Win with me. If you put your money to work with me," the consultant's position says, "you will have more money back sooner and surer." At the same time, you will have a greater market share of a current market, or you will have gained entry into a new market, or you will have a reduced cost burden in an important operation or greater productivity. You will be competitively advantaged as either a market share leader or as the industry standard of value as the low-cost producer.

The Box Two connection is vital. It is the essential linkup that makes Consultative Selling work. Without it, vendors remain vendors at the Box Three level, as these comments—typical of trying to sell consultatively to an untrained and unpartnered purchasing function—show:

"The customers have not responded. We try and try but at the end of our product demos, the same questions are still raised: what is the price and how much of a discount does it represent?"

"We must be qualifying opportunities far too late in our customers' decision process. We have no time to PIP, just enough to propose a quote."

The true value of the competitive advantages you bring to customers is not in new profits themselves but in their investment value when they put them to work. How much more can they make on what they have just made with you? Funds always seek work. Idleness incurs opportunity cost. For this reason, you must have your next investment proposal in your hip pocket—actually, in your Account Penetration Plan—ready to present as soon as your current project has reached payback. This maintains your position squarely in the flow of funds while simultaneously repositioning your customers for the next round of being competitively advantaged by their partnership with you.

As your customer partners position you, you are an optional investment opportunity. This is how you must come across to them. It tells you how you must define the nature of your business with them:

  • If you are in the telecommunications business, you must not simply be "in telecom." You must not sell switches, networks, or rates.

  • You must not be simply one more "problem solver." You must not just sell "solutions."

  • You must not simply be a "consultant."

You must be a profit improver, a partner whose expertise and experience in the customers' businesses can help the customers increase the amount, speed, and certainty of the profits they contribute to their top-tier managers in Box One. You must understand the world that your partner lives in. If they are "in manufacturing" and considering robotics, they live in a world of cost contributors, such as Figure 2-3 shows. Which of them can you help the customers control? Your contributions are your tickets of entry into their world. How much you can contribute, how soon, and how reliably will determine whether you will be invited to live in your customers' world as their partner or will just be passing through.

start figure

Acquisition Costs

  • The robot and its tooling

  • Facilities, equipment revisions, and rearrangements

  • Application engineering

  • Process and product changes

  • Training and transfers

  • Installation

  • Direct labor costs

Life Cycle Costs (Costs of Ownership)

  • Cost of capital

  • Taxes and insurance

  • Maintenance labor, supplies, and spare parts

  • Energy

  • Training

  • Scrap and rework

  • Safety and potential cost of disability

end figure

Figure 2-3: Robotics cost checklist.

Consultative Selling(c) The Hanan Formula for High-Margin Sales at High Levels
Consultative Selling: The Hanan Formula for High-Margin Sales at High Levels
ISBN: 081447215X
EAN: 2147483647
Year: 2003
Pages: 105
Authors: Mack Hanan

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