The most dangerous letters in sales are RFP. By Steve
Waterhouse
Respond, and you lose…
One of my clients emailed me an RFP (request for
proposal) that they received yesterday. It came from a
company who had never done business with them and who
they had never even called on. They know my rule. RFP
means one of two things. It's either ‘Real Fools
Participate' or ‘Request For Probing'.
Real Fools are the ones that read the document and
believe every word. It says, “All questions must be in
writing” and “Contact with the company must be through
the purchasing office”. If you play this game, you are
falling into the trap of thinking that this makes a
level playing field for all bidders.
Wrong!
First of all. I hate level playing fields. I like the
ones that are sloped down hill, in the direction I am
running. Unless you are up against a government contract
where public laws dictate the rules, there is almost no
reason for a company to ‘level the playing field' or for
you to accept one. In fact, this type of ‘level playing
field' works against both companies. The buying company
loses because they only get answers to the questions
they thought to ask and the seller loses because they
can only respond to the limited information provided.
Second, it's rarely level. Unless the company started
yesterday, they have a rapport with another vendor. That
vendor probably helped write the RFP.
Do you call that level?
So what's the solution? First, you must understand
that the probability of winning business from responding
to an RPF where you have no relationship with the client
is so close to zero as to not be worth discussing.
Unfortunately, everyone has won one or two and believes
that they are the exception. Studies done by the
Waterhouse Group and others show otherwise.
Once you believe in the low probability of winning
these RFP's, you are ready for the solution.
Refuse to look at an RFP as an immediate need to
begin preparing a proposal. It's not. In fact, in most
cases, you would be better off making another cold call
than responding to the RFP's terms.
Redefine the RFP as a Request For Probe. That means,
the prospect has sent up a signal flare that identifies
a source of potential business. Treat it like any other
hot lead.
Assuming that the business outlined in the RFP is
business you want or that it could lead to business you
want, start digging.
Start digging for what?
Contacts:
Contacts within the company who will talk with you.
Call the CEO or have your CEO call their CEO. Call
department heads or managers of departments affected by
your offering. Look high and low for as many of the
buying influences as you can find. Ideally, get to the
economic buyer and others who will be involved in this
decision.
Information:
Information about the company that indicates how your
solutions might help their business. Search their web
site for press releases and articles. In the example I
cited above, we determined that the prospect had just
undergone a major cost-cutting layoff to save the
company. While some might say that this indicates a
price shopper, I say no. The buyer may be a price
shopper but the CEO is a survival shopper. Show the CEO
how you can save the company and they will find the
money to pay you.
Competition:
Clues to the competition and how entrenched they
already are in this deal. Who wrote the RFP? Did the
competition write it? Who are they using now? Who have
they used in the past. Whose names are in the guest log
at the main desk? Google them and see if they show up as
a client of your competition. Many companies post case
studies on their web site. That's great stuff if you can
get it.
Process:
What is the intended buying process? How do they
intend to compare vendors and what criteria have they
established. How did they do it last time or how did
they choose vendors for another product or service.
Often sales people who sell other products to your
prospect will be willing to fill you in. It's worth
asking.
Chapter 7 of “The Team Selling Solution: Creating and
Managing Teams That Win the Complex Sale” addresses many
of these issues. If you work out regularly or drive a
lot, get the audio CD version available on my website
at:
The Team
Selling Solution
If you understand consultative selling, and most of
you should, you get the point. You can't solve a
customer's problem by presenting a solution to the
problem they mailed in. Any more than a doctor should
write you a prescription to cure an ailment that you
self-diagnosed.
Refuse the urge to respond to RFP's until you know
the lay of the land. When you change your approach from
Real Fools Participate to Request For Probe, you'll
write fewer proposals and make more sales.
You might also be interested in my article, "10 Ways
to Generate Great Sales Leads". To get a free copy,
simply email article24@waterhousegroup.com.
Steve Waterhouse is Principal and Founder of Waterhouse
Group (www.waterhousegroup.com), a sales consulting and
training company that helps companies dramatically
increase their sales. He can be reached at
1-800-57-LEARN or
info@waterhousegroup.com.
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