Money Talks, Startup Corner

Be A Financial Improvement Specialist

I got this on WhatsApp.
—–

“A single idea – the sudden flash of an idea – may be worth a million dollars.”
(Robert Collier)

In consultative selling, you position yourself as a consultant, an expert, an advisor, a helper and teacher in the sales situation. Above all, you position yourself as a problem solver. You ask good questions and listen attentively to the answers.

When you are selling to businesses especially, you position yourself as a “Financial Improvement Specialist.” This requires that you focus all your attention on showing the customer how his or her business can be financially better off as the result of using your product or service.

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Customers of the top salespeople describe them as consultants, “unpaid members of my own staff.” They say, “He/she really understands my situation.” This must be your aim as well.

You begin the sales process by asking questions about your prospect’s business, seeking to understand how sales and revenues are generated, how costs and expenses are incurred and how profits are made. You put yourself in the position of the business owner or executive and try to see yourself as being personally involved in achieving the financial results for which he or she is responsible.

Once you understand how your prospect’s business or department operates, you then find a way to define what you sell in financial terms. Your primary aim is to demonstrate to the prospect that the financial benefit of dealing with you is greater than the cost of what you are selling.

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Many companies use “internal rate of return” to evaluate a new business expenditure. This is the return on investment that they aim to attain in purchasing new equipment of any kind. For example, a company may set 15% as their “IRR.” This means that, for you to sell the company something, you must demonstrate that it will save or make the company 15% or more each year, and eventually pay for itself.

The higher the rate of return that a business can achieve in using your product or service, the more attractive it is to buy and use because it basically pays for itself, and yields a profit.

The most important decision criterion business people use in evaluating a prospective purchase or expenditure is called “time to payback.” This is the amount of time that will pass before the company gets 100% of its money back. This is determined by dividing the IRR into the number 72. (For example, if your product or service will save or earn the company 20% of the cost each year, the time to payback is 3.6 years). The company then compares this rate of return against alternate uses of the same money.

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In determining time to payback, the prospect has four key questions, spoken or unspoken, that you must answer.

The first question is, “How much does it cost?”

The second question you must answer in your presentation is, “How much do I get back in return for my investment?”

The third question is, “How fast do I get this amount back?”

The forth question is, “How sure can I be that your projections are accurate?”

The greater clarity with which you can answer these questions, the easier it is for the prospect to buy from you. The fuzzier you are in answering these questions, the harder it is for the customer to make a buying decision. If neither you nor the customer can figure out the rate and speed of return, no sale will take place.

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As a financial improvement specialist, you continually point out how the customer can achieve more of his or her business goals as the result of following your advice and recommendations. You position yourself as an unpaid member of the customer’s staff, helping him or her to increase sales, reduce costs or boost profits. You show that your product or service is actually “free” in that he/she ultimately gets back far more in dollar terms than he or she pays in the first place. This is a vital key to high level selling.

Action Exercises:

  • Determine the exact rate of return, in terms of time or money saved or gained from using what you sell.
  • Describe your product or service in terms of how it effects the financial situation of your prospective customer. Think in terms of the direct as well as the indirect financial benefits your customer will enjoy as a result of using your product or service.
  • Identify the prospects in your market who can most benefit from the financial benefits your product or service can contribute. Focus more of your selling energies on those prospects who can profit the most rapidly from what you sell. Build your sales activities around finding more and more of these prime prospects.

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