YOUR PRICE

Is tOO

hIgh!

hOw tO dEal wIth thOsE

PaInfUl PRICE ObjECtIOns

feb 4TH 2009 / Issue 17

EnCOURagIng YOUR REPs tO add ValUE

sEttIng salEs taRgEts3 COmmOn mIstakEs tO aVOId

$

The 5th Annual

Create a motivated and resilient sales team to succeed in uncertain times

27 & 28 April 2009, Rendezvous, Auckland

Packed with case studies from successful Sales ExecutivesIcebreaker

Fonterra Brands (Tip Top)

Majestic Global NZ

Offi ceMax

Oxfam

Gen-I

Rockwell Automation

» Click here to view full agenda & registration

details

A key event for all Sales Managers, Key Account Managers, Marketing Managers, Business Development Managers and all those that want to reach the top in sales

management in today’s challenging economy

REGISTER NOW SAVE $300with our Early-Bird Special. Register and pay before 5.00pm 16 March 2009

Summit

Brought to you by:

Recession affecting your sales targets? Struggling to keep your team motivated?Don’t despair! Get some new inspiration and renew your leadership confi dence at this year’s Sales Managers’ Summit.

Untitled-4 1 2/2/09 9:09:43 AM

NZsM / feb 4TH 2009 / 3

febRuARY 4TH / Issue 17

thIs wEEks mUst REad

YOUR PRICE Is tOO hIgh

How to deal with those painful

price objections.

sEttIng salEs taRgEts

Three key mistakes to avoid.

nZsm CalEndaR

twO mInUtE tOP-UP

OnE IdEa PER CUstOmER

encouraging your reps to add

value.

bOOk REVIEw

hOw I RaIsEd mYsElf

fROm faIlURE tO sUCCEss

In sEllIng

A business classic, this book

is for anyone whose job it

is to sell. Whether you are

selling houses or mutual

funds, advertisements or ideas

-- or anything else -- this book

is for you.

salEs tRaInIng dIRECtORY

thE ClOsE

8

1112

5

8

10

11

12

13

14

YOUR PRICE

Is tOO

hIgh!

hOw tO dEal wIth thOsE

PaInfUl PRICE ObjECtIOns

$5

NZsM / feb 4TH 2009 / 4

2009. In Chinese Astrology this

is the Year of the Ox, which

symbolises prosperity through

fortitude and hard work. After the

giddy ride of the last few years to the

top of the economic boom, and the

traumatic burst of the bubble over the

last 9 months, this year is a time for strength, stability

and modesty.

As anyone who did economics in fifth form will know,

our economy (as with everything in life) is in a constant

state of flux. It goes through cycles of growth and

decline, boom and bust, just as nature dictates that night

will always follow day, and autumn and winter will

always follow summer.

Regardless of the events precipitating the economic

winter we find ourselves in now, the important thing

for us all to note here is that this is no more than a

continuation of the natural business cycle, although it

still caught most of us by surprise.

Yes, we should acknowledge that we are in what the

economists refer to as a “recession”. Yes, we should

acknowledge that many of our customers may have

less cash available to spend on our products and

services. There’s no denying it and we can’t do much

to change it. Insisting on wearing your speedo’s in the

middle of August will not change the fact it is winter

– you’ll just die needlessly of hypothermia.

but what we can all do is decide how we are going

to react to these circumstances. As individuals, as

families, as businesses and as communities, the one

thing we can control is our attitude towards adversity.

some say that adversity brings the best out of Kiwi’s

so let’s take note from our companion the Ox and

commit ourselves to a year of hard work, practicality,

and the determination to get ourselves ready for the

economic spring that is sure to follow.

for us at NZ sales Manager we’ll be introducing several

exciting new features this year, and look forward to

helping you make the most of the sales opportunities

that come your way.

It’s great to be back!

Richard

AbOuT /

short and sharp, New Zealand sales

Manager is a free fortnightly e-magazine

delivering thought provoking and

enlightening articles, and industry news

and information to forward-thinking sales

managers, business owners and sales

professionals.

eDITOR / Richard Liew

ART DIReCTOR / Jodi Olsson

ADVeRTIsING / Dave Mahony

ADVeRTIsING eNQuIRIes /

Phone Dave on 021 843 040 or

email davem@leapsolutions.co.nz

CONTeNT eNQuIRIes /

Phone Richard on 09 523 4112 or email

richardl@nzsalesmanager.co.nz.

POsTAL ADDRess /

NZ sales Manager

C/- espire Media, PO box 137162,

Parnell Auckland 1151,

New Zealand

WebsITe /

www.nzsalesmanager.co.nz

nZ sales manager is an

Espire media publication

NZsM / feb 4TH 2009 / 5

Cost down and commoditisation is a

relentless reality of the globalised, infor-

mation driven world in which we live.

We need to change the way we sell if we are to

overcome the daily challenge of buyers saying,

‘Your price is too high…’

I recently attended a CIPs (Chartered Institute

of Purchasing and supply) forum where a

panel of ‘experts’ debated the current state of

procurement in NZ. While this was a fairly

chaotic debate to say the least, one member of

the panel commented that procurement in NZ

is relatively unsophisticated. There are simply

not enough large companies here who are of

the size where strategic procurement is viable.

I tend to agree and also came away thinking

that their message was that ‘cost down’ is pretty

much where it is at. ‘No surprises there’ you

might be saying.

A few months have since passed and the credit

squeeze is affecting business. Projects are being

put on hold and buying decisions moved up to

senior levels as companies ride out this period

of economic uncertainty.

The consequence for many sales people in

these times is that selling becomes all about the

price. If the talk around your coffee machine is

‘we are too expensive’, and ‘we can’t compete

on price’, then read on, as it is likely to be a

symptom of how you are selling rather than

what you are selling.

do your buyers turn straight to the “sports

pages” at the back of your proposal to see

what the price is?

by Paul Newsom

YOUR PRICE Is tOO hIgh!

$$$

T H I s W e e K ’ s M u s T R e A D

\\ how to deal with those painful

price objections.

NZsM / feb 4TH 2009 / 6

I often find that when sellers complain that ‘it is all

about the price’, all too often it is all about price

because they are only competing on price! Price is the

easiest criteria for people to use in the buying decision.

Price comparison is quick and something we all

understand.

When the features of competing products look the same

to the buyer, price quickly becomes the primary factor for

the buyer to consider. I see many proposals and quotes

where the only criteria given for the customer to decide

on is price, yet sales people complain that it is all about

the price! Discounting then starts (what else is there to talk

about?) and continues until the customer says yes.

If this is you, in the long term you can’t win. someone

will always drop their pants on price lower than you are

prepared to.

whY Is thE ‘PRICE tOO hIgh’?

When the buyer says ‘the price is too high’ it will

generally be for one of five reasons:

1. You have quoted the wrong thing to meet the need

2. You have not understood how and why the customer buys

3. The value of the benefit of your solution/product has

not been understood

4. They do want to buy from you, but want to feel they

have got a discount

5. Your price really is too high.

let’s take a quick look at these:

1. You have quoted the wrong thing to meet the need.

It’s an old cliché but offering a Rolls Royce when the

customer needs a Mini is just plain bad selling. You

won’t win this time and probably won’t be invited back.

Your customer will not trust you.

If you don’t have the right solution for the customer,

then say so. If you can, recommend where they will find

the right solution.

2. You have not understood how and why the customer buys.

understanding the buyer motive is a widely taught

selling skill, yet when in front of the customer, it is often

done in insufficient detail. In your eagerness to make a

sale, the trap is to present the solution far too early – so

the customer judges you on price only.

Put the customer’s needs ahead of yours, start listening

to your customer and stop talking.

3. Your value is not understood.

You have a solution that is differentiated from your

competition, yet the customer doesn’t ‘get it’, and

won’t pay for it.

Whole books are written on this. Here’s step 1 in two

sentences. first understand what issues and problems your

customers would have in the absence of your solution.

Only when you can quantify this, will you be able to begin

to define value in a way that will be understood by the

customer to the extent they are prepared to pay for it.

4. buyers want to get a discountMany buyers like to feel they have to get a discount

each time they buy (like me!). The problem for the

seller who discounts is that if you offer a discount the

first time, the customer will be expecting a discount

the next time they buy. Your first price is then never

the real price.

You must either understand the opportunity well

enough to know that your first price is your best price

and will win, and make sure the customer knows

that it is your only price. Alternatively be prepared to

manage the expectation of discounting for the life of the

relationship.

before rushing to discount until the customer says ‘yes’,

pause for a moment and find out what ‘too high’ means.

Too high compared to what?

5. Your price really is too highIf there are lower priced alternatives in the market

that offer the same or more value, and the customer

does not value the relationship, then the product is

commoditized in the mind of the customer. Your price

really is too high.

The best advice is to fix it or go and sell somewhere

else. for top sales people, price is rarely an issue

because of how they sell. You will notice that reasons 1-

4 above are fixed by how you sell.

NZsM / feb 4TH 2009 / 7

Many sales training manuals will advise to keep off the

price until everything else has been discussed and agreed,

yet many buyers want to get quickly onto price.

Put yourself in the buyer’s shoes for a moment. When you

are buying you want to know what the price is don’t you?

How do you feel if you can’t get to the price, or the sales

person won’t tell you the price? You become suspicious.

You lose trust, are likely to be put off and go and talk to the

next supplier. so don’t do it to your customer – if you do,

price will become an issue before you want it to.

When asked about price, you have to manage expectations

around price, rather than sidestep the customer’s question.

Bear in mind that as part of your qualification, it will be

in your interests to set a price expectation early on so

that you are not wasting your time. If the customer is only

prepared to shop at The $2 Shop, then it is best to find this

out early in the piece and let them go to The $2 shop. (I

have nothing against The $2 shop, and buy there regularly

myself for those squishy balls etc you find on the table at

training sessions!).

If you have a solution of value and you want the customer

to pay for this value, then manage these expectations by

quoting a reasonable price range that is based on what you

know at the time. Then qualify this with a comment such

as ‘I expect it will be significantly less than the cost of the

problem’, or ‘it will be a small investment to solve what

seems to be a major problem for you’.

Get agreement before you proceed. If you’ve had the

conversation about price early on, price is less likely to be

a big issue at decision time.

It is true that as the sale becomes more complex, getting on

to specific price too soon will result in you being judged

on price alone and value will be left on the table. being

able to answer the question with credibility requires good

consultative selling skills.

In summary, price will remain an issue for the self

serving sales person who is focussed only on their own

interests and when the sales conversation does not go

beyond the product or service they are selling. When top

sales people stand in their customer’s shoes, understand

their business, help them to make good buying

decisions, and differentiate their product or service,

company, and themselves from their competitors, then

price is rarely an issue.

Paul newsom is learning & development manager for the Rev sales network, a nationwide personal and

professional development network for sales professionals. Visit www.rsn.co.nz for more info.

keep off the price at your peril!

NZsM / feb 4TH 2009 / 8

sEttIng salEs taRgEts

At this time of year a lot of businesses are revisiting

their sales goals and target. We thought it would

be timely to share the biggest mistakes we see

businesses making when it comes to sales planning.

MISTAke 1: AccelerATed GrowTh rATeS

In this context, your growth rate is the percentage change

in your turnover each year. If you have a turnover of $100

000 in 2007 and then $120 000 in 2008, your growth

rate is 20% / annum. One of the biggest mistakes business

owners make is setting unrealistic growth rates for their

business. for instance, consider the following data.

historically the business has achieved:

* 2003 = $50,000

* 2004 = $70,000

* 2005 = $100,000

Then they start planning sales goals for the future:

* 2006 = $200,000

* 2007 = $550,000

* 2008 = $1,200,000

on the surface these figures may look reasonable, just a

few $100,000 here and there. However, the growth rates

tell a different story.

* 2004 = 40%

* 2005 = 42%

* 2006 = 100%

* 2007 = 175%

* 2008 = 118%

It’s not so much that these growth rates are impossible but

you must seriously question how a business is going to go

from a growth rate of 42% to 100%+ in just 12 months.

Most business owners setting ambitious sales goals don’t

think through this in enough detail and fail as a result.

but shouldn’t sales gobals be ambitious?

A lot of management books push business owners to

“shoot for the stars” when setting goals for their business.

three key mistakes to avoid by Kirrily Dear\\

NZsM / feb 4TH 2009 / 8 NZsM / feb 4TH 2009 / 9

It needs to be clear who is accountable for sales performance in the business and what that specifically entails.

kirrily dear is the founder and development director of australian marketing, management and strategy consultants Eyes wide Open. Visit their website at www.eyeswideopen.com.au.

We disagree with this mindset when it leads the business

owner to set goals that lack a pragmatic foundation.

substantial growth is possible but you have to carefully

plan how it will happen. What’s going to give you the leg

up? More sales staff? A merger with another business? A

new contract? better facilities or more warehouse space?

be very careful about setting your business on a course

for substantial growth. It will most likely put your people,

cashflow and other resources under enormous pressure.

failure to achieve the goals can be devastating to the

business, your credibility and the confidence of the people

within the business.

from our experience, you are likely to be more effective

setting more conservative, well considered goals. We call

this “setting yourself up for a win”. After all if you achieve

them quicker than expected you can always set new ones!

(Of course, you only set new ones after you’ve celebrated

your win!). Taking this approach leads to business growth

being a more enjoyable and rewarding journey for all

involved.

what growth rates are reasonable?

The level of growth that is considered “reasonable” will

vary depending on the age of the business, industry and

how well it is run. New businesses can have amazing

growth rates because they’re working from a small base.

some of the large, heavy industrial corporations rejoice

when they get growth of 15%.

Also it depends on what industry you are in. for instance,

aged care at the moment is booming so you can expect

most businesses to have strong growth rates whereas other

industries are in decline and growth is incredibly difficult

to achieve.

MISTAke 2: lAck of chAnGe

The old axiom “To get a different result you need to do

things differently” is highly applicable to the process of

increasing sales.

sales growth generally doesn’t happen purely through

working harder. You’ve got to work smarter. There needs to

be a fundamental shift in the way you are generating sales

for there to be a significant increase in sales.

Once you have clear and practical sales goals for the year,

you then need to do a gap analysis. That is, look at the

difference between what you want and what you’ve got, to

determine what changes are required to achieve those sales

levels. Perhaps you need a better system for generating

leads, or more products and services to sell or perhaps

better internal administration. Then take these changes

and break them down into specific steps and allocate a

completion date and person responsible for each step.

MISTAke 3: lAck of AccounTABIlITY

This is particularly an issue when there are more than one

or two people in the business. It needs to be clear who

is accountable for sales performance in the business and

what that specifically entails.

A lot of activity is required to achieve sales growth.

Nobody ever achieved sales growth by just sitting around

and thinking about it. Clearly specify what type of activity

you want to see; client visits, speaking gigs, mail outs,

quotations, follow-up phone calls etc.

Then set levels for each activity, for instance 3 client

visits per week. These are commonly referred to

in planning as KPI’s or Key Performance Indicators.

Your aim in implementing KPI’s is to give people a

structure to work within, to help them manage their

own activity and know what they are meant to be

working on. This ultimately enables everyone to be

more productive.

NZsM / feb 4TH 2009 / 10

fRI 6 MARTHu 5 MARWeD 4 MARTue 3 MAR

MON 2 MARTHu 26 febWeD 25 feb

Tue 24 febMON 23 feb

WeD 18 febTue 17 febMON 16 febfRI 13 feb

THu 12 febWeD 11 febTue 10 febMON 9 feb

fRI 27 feb

suN 1 MAR

sAT 28 feb

suN 22 feb

sAT 21 febfRI 20 febTHu 19 feb

suN 15 feb

sAT 14 feb

suN 8 feb

sAT 7 feb

fRI 6 febWeD 4 feb THu 5 feb

suN 8 MAR

sAT 7 MAR

NZsMCALeNDAR

Workshop – How To Cold Call & Have funTop Achievers sales TrainingAuckland - east

Workshop – NetworkingTop Achievers sales TrainingAuckland - east

Key Account ManagementDavid formanAuckland

Workshop – Cold Calling & ProspectingTop Achievers sales TrainingAuckland - southsales basics seminar GeewizAuckland sales skills Level OneeMAAuckland

excellence in sales & Marketing sMINZAuckland

exceeding Customer expectationsGeewizAuckland

sales basics seminarGeewizWellington sales skills Twoessential sales skilsZealmark GroupAucklandsales skills Level OneeMAAuckland

Advanced serious sellingRichard GeeWellington

Professional selling skills CoreAchieveGlobalAuckland

Advanced serious selling Geewiz

Wellington

exceeding Customer expectationsGeewizWellington

Professional selling skills CoreAchieveGlobalAuckland

Advanced serious selling Geewiz Wellington

Advanced serious sellingGeewizAuckland

Jamie ford presents “Are You Tough enough?”Rev sales NetworkAuckland

sales skills Oneessential sales skilsZealmark GroupAuckland

sales skills Oneessential sales skilsZealmark GroupAuckland sales ManagementDavid formanAuckland

Professional selling skills CoreAchieveGlobalAuckland

Professional sales CoachingAchieveGlobalAuckland

Professional sales CoachingAchieveGlobalAuckland

Key Account ManagementDavid formanAuckland

feb 23-25NegotiationDavid formanAuckland

feb 23-26sales DevelpmentDavid formanAuckland

sales ManagementDavid formanAuckland

sales ManagementDavid formanAuckland

sales ManagementDavid formanAuckland

NZsM / NOV 12TH 2008 / 11

OnE IdEa PER daY, PER CUstOmER// encouraging Your Reps to Add Value

The greatest way to build sales is to get existing

sales reps who are calling on existing custom-

ers to add value, and help customers make more

informed decisions, from their extensive product and

service knowledge.

A simple strategy to implement with your sales force is

called ‘One Idea Per Day, Per Customer’.

In every sales team you build your business one

customer at a time, one transaction at a time, so

following through on this philosophy, show your sales

reps how they can add one idea as a suggestion, not

an opinion, to each customer at each visit. Gradually

over time they will have a reasonable success rate and

become confident enough to keep on adding ideas

which will increase the range of products purchased.

The most important thing is to encourage the customer

to make the idea or suggestion themselves, which

means you don’t use the words ‘I’ or ‘we’. Instead

use the words ‘some of our other customers have’ to

introduce the suggestion or the product idea. A sales

representative is better known for being an ideas

suggestion person than a hard, pushy salesperson.

One way to encourage the ideas is to take some of your

products or services and encourage the reps to select

a particular product or service for that week or the

interval between your sales meetings, and get them to

brainstorm and write down as many possible methods

of communicating an idea or a benefit about that

product or service.

Then all they have to do is to take one of those ideas

and mention it to each customer they call on.

The advantage of having different products or services

scattered around your sales team is that you will find that at

the next sales meeting each one of them will

have had some successes and they will be able to pass on

those ideas which worked, and encourage the rest of the

team to try them.

sales promotions, where products are featured with special

bonus offers, discount offers or special incentives, will

always work well as encouragement incentives, but make

sure that your sales team has sufficient supplies of leaflets,

handouts, or flyers to leave with the customer about the

special promotion.

Remember that human beings are visual people and like

to see pictures, graphics, or visualisation of new products

or services. An idea that has a graphic showing how it can

be used, or a physical product to actually look at, or an

enthusiastic story to show how other customers have used it,

is more likely to be listened to.

Just consider that if you called on ten customers a day and

suggested one idea to each one of them, and had a 50%

success rate, at the end of the week you would have added

25 new lines to your group of customers. At the end of the

month 100 new lines, at the end of the quarter 300 new

lines, and satisfied customers.

Where did it all start? Just suggesting one idea, per day, per

customer.

An idea a day works – how many ideas can you come up

with?

by Richard Gee

T W O M I N u T e T O P - u P

Richard gee is a leading sales and marketing coach, author and seminar presenter.

Visit his website at www.geewiz.co.nz.

NZsM / feb 4TH 2009 / 12

R e s O u R C e C O R N e R

A business classic, How I Raised Myself from Failure to Success in Selling is

for anyone whose job it is to sell. Whether you are selling houses or mu-

tual funds, advertisements or ideas -- or anything else -- this book is for you.

When frank bettger was twenty-nine he was a failed insurance salesman. by the

time he was forty he owned a country estate and could have retired. What are

the selling secrets that turned bettger’s life around from defeat to unparalleled

success and fame as one of the highest paid salesmen in America?

The answer is inside “How I Raised Myself from failure to success in selling.”

bettger reveals his personal experiences and explains the foolproof principles

that he developed and perfected. He shares instructive anecdotes and step-

by-step guidelines on how to develop the style, spirit, and presence of a

winning salesperson. No matter what you sell, you will be more efficient and

profitable -- and more valuable to your company -- when you apply bettger’s

keen insights on:

- The power of enthusiasm

- How to conquer fear

- The key word for turning a skeptical client into an

enthusiastic buyer

- The quickest way to win confidence

- seven golden rules for closing a sale

hOw I RaIsEd mYsElf fROm faIlURE tO sUCCEss In sEllIngby frank bettiger Published by fireside books

$29.98 from

NZsM / feb 4TH 2009 / 13

NZsM / feb 4TH 2009 / 14

“

“

haVE YOU sUbsCRIbEd tO nZ salEs managER? It’s fREE!

subscribe to NZ sales Manager and go in the draw to win a copy of the excellent book Kites Rise Against The Wind – Positive and Powerful Ideas to Unlock Your Potential, written by New Zealand’s own performance psychologist and motivational expert Charles Donoghue, this is

an essential book for all high achievers and their managers.

To enter the draw simply visit www.nzsalesmanager.co.nz and sign up before 5pm, Monday 16th february to get a copy of NZ sales Manager

delivered straight to your inbox every second Wednesday.

winner will be notified by email and published in the february 18th issue of NZ sales Manager.

subsCRIbe TODAY!

The important thing is to learn a lesson every time you lose. Life is a learning process and you have to try to learn what’s best for you. Let me tell you, life is not fun when you’re banging your head against a brick wall all the time.

John McEnroe

NZsM / feb 4TH 2009 / 14