Sales 101 – Qualifying For Budget Part II

Show me the money! Repeat……Show me the money! (smile). First off, just might be good for all to review “Qualifying For Budget Part I” prior to embarking on the rest of this journey (smile). In the previous post we discussed that everybody has a budget. Today we will discuss:

1. Why they don’t want you to know what that number is
2. Why you desperately need to know this information
3. The benefits for both parties involved

#1 – Why folks don’t want to share their budget

1. They think you will spend all of it (which may be true (smile))
2. They think that you may have been thinking about a lower cost solution and now that they have “spilled the beans”, your solution just jumped up a few notches (might also be true (smile))
3. They perceive this as a loss of negotiation position. They have shown you their cards

#2 – Why you need to know their budget

1. In the simplest terms, if your product or service starts at $1,000 and they are only willing to invest $100, regardless of the benefits, you are probably both in the wrong “pew” (smile). Champagne taste…..beer budget?
2. Perhaps you have multiple possible solutions that will fit your client’s needs and you need to determine if we are talking good, better, or best
3. It gets the “dirty little secret” part, the part that nobody wants to talk about,  of the transaction out and open and on the table. My experience is that it is best to do this early
4. If you present a solution that both meets their needs and their budget, the likelihood of a mutually beneficial transaction increases dramatically

#3 – Why knowing this is best for both parties

1. It sets realistic expectations for both sides involved
2. It makes the best use of everybody’s time and efforts
3. It is the most cost effective method for proceeding
4. It allows the sales representative the opportunity to demonstrate that they listen, understand, and are concerned about providing the right solution for the client and at a budget that they can live with

Certainly, all of this is highly simplified and I’m positive that I have missed a lot of other good reasons. Feel free to pitch in with your thoughts or comments. With the same certainty, much of this “dance” revolves around issues of trust. That old school “it’s us vs. them” mentality. The perception of this being a “combat situation” (smile). It does not, and should not, be that way. Modern selling is less about selling and more about “helping people to buy”. Getting to that “win-win”.

Please watch for Part III where we will discuss:

1. When and how to start this conversation thread
2. How you will provide the reasons for doing so
3. Tips on helping folks to determine their budget whether they already know it and don’t want to share it or…. in the instance where they really do have no idea. But, everybody still has a budget (smile)

Thanks!

Craig