Have you ever had a potential BIG sale or deal that would make all the difference for you and your business, but just couldn’t close it for some reason? Boy, I know I have seen my share of it. And I still see it with clients all the time, where there’s such enormous opportunity and we eventually just give up (or worse yet, keep waiting for someone else to close it for us, like a reseller or agent, for example)…
Years ago, I had a situation come up that I will never forget. At the time, there was a $10,000 sale that I really needed to close, but the customer was playing extreme hardball on price, and I just couldn’t agree to $2,500 for what was arguably worth $25,000, that I was ready to let go of for just $10,000 (it was a source code licensing deal). Anyway, the customer knew I needed the money, and was just trying to take advantage of the situation and get a steal of a deal.
When I had just about given up on this deal, I shared my frustration with a sales mentor and friend at the time. He said, “Rick – you can’t conjugate the dead ones – there is no ‘deader’ or ‘deadest’ – if it’s dead, it’s dead – - – so you have nothing to lose by trying again and doing whatever it takes to close that sale!”
I thought about those words – if it’s dead, you can’t make it any deader by going back in for one last-ditch, whatever-it-takes attempt to close the deal. It turns out, this was exactly the inspiration and guidance I needed…
I decided to try something that seemed at the time, well, a bit crazy actually, but hey, it couldn’t get any deader than dead, so what did I have to lose by trying?
So I called the guy up and said, “you know what, I’ve been thinking about our conversations, and I realized something. You’re absolutely right – that source code is not worth $10,000 at all – it’s actually worth $25,000 and I’m not going to let you have it for $2,500. So the new price is $25,000. You know how to reach me if you decide you still want it. Good day.” – and I hung up.
Afterwards I thought to myself, “man, that felt good, to tell them how I really feel and show them they can’t take advantage of me, and stand up for myself and my beliefs”. Of course, several days went by, and the phone didn’t ring. So I called the guy back to put part 2 of my “Raise the price close” into motion.
He answered and I said, “It’s me again. You know, I’ve been thinking… It wasn’t really reasonable of me to ask for $25,000, but we both know that source code will save your company months of effort and get your project on the right track fast, just like we discussed. And since I am a reasonable person, I’m willing to make it available at the $10,000 price that I originally offered.” Then I shut up. After several moments of uncomfortable silence, he said “Okay – after you said the price was $25,000, I talked with my CEO and team, and we agree that $10,000 is a fair price that we can pay. We can get a check out to you today. When can you deliver the code?”
My jaw about hit the floor. I couldn’t believe my ears – it actually worked! What appeared to be a lost opportunity (without a horrible discount), was now a done deal!
Needless to say, I was quite proud of myself for pulling this off – and listening to my mentor’s advice. Naturally, I went back and shared my story of what had happened with him and let him know his advice worked. He laughed out loud and said, “That’s great! See what a little persistence can accomplish?” Later he told me he thought that was one of the craziest closes he’d heard about in a long time.
I have never had the opportunity to use that particular close again (and frankly hope I never have to), but in hindsight it did teach me some things about Sales that as a young entrepreneur and budding salesman, I still didn’t realize fully:
1) You can’t close any big sale by dealing with a non-decision maker or intemediary – you must somehow reach the person with the power to say Yes (and that was the real lesson to be learned here – finding a way to be heard by the actual decision-maker)
2) Being willing to walk away from a prospective customer who’s being unreasonable about price and trying to take undue advantage of you or your company can improve your negotiating position
3) Using a higher price point to establish value, then offering a perceived discount, is a great way to let the customer feel better about the price they’re paying (this is obviously common practice)
4) Never give up – especially if the customer is still on speaking terms with you (and even if they aren’t for a while)!