Business Articles - Sales

Understanding Selling Value

How much does it cost? The one question most dreaded by contractors trying to sell their services to a prospective client. They know from past experiences that this one question will automatically lead them into a low price war.

The art of selling your products and services for a higher value is understanding a key element about the process. Selling is all about doing the right homework up-front and attempting to get it right the first time.

For those of you who have attended my workshops you know first hand that I tell you that in the selling process, you have a 100% chance of closing the deal in the first proposal meeting. If you're required to come back for a second meeting, your chances of closing the deal have reduced to only 60 to 70%. A fourth meeting and you're looking at a 40 to 50% chance. In short, the odds are working against you.

With that in mind, you must understand the 'process' of setting the stage for a successful selling adventure and the following information is your first step in doing so.

The first major step is to avoid at all cost the question 'How much will it cost?' Even though this will usually be the first words out of the prospect's mouth, you must develop a system a working your way around this question, even though it seems like this is the only thing the prospect is interested in. To attempt to answer this question instantly focuses the entire process on low pricing, shoves all concern about value, scheduling wants and needs aside and you'll always come out a loser in this process.

So how can we react to this question and maintain a level playing field? Simple, with a hearty chuckle a great deal of sarcasm, simply ask the prospect:

Is price your only issue?

And then, sit back quietly and observe the prospective client while they ponder the question and determine their answer. If the prospective client says that pricing is their primary concern, immediately ask:

How did you determine that price, where did it come from?

If the client doesn't respond repeat the question:

Is price the only thing you're concerned about?

Then continue immediately with:

  • What about your completion requirements, what are they? Is it important to you and why?
  • What about quality and craftsmanship? Are you looking for the best possible quality at a reasonable price?
  • Have you given any thought to warranty, guarantee, and follow-up? We stand by our construction services with ... (state your warranty or guarantee. Even better, have a written copy in your presentation manual to show them. Check out our book: How to Market & Sell Your Construction Services Like Magic! At our web site for more information on developing your presentation manual and the dynamic three-step process)
  • Have you ever dealt with contractors before and what kind or problems did you experience? This leads you into telling them how you'll solve all their problems for them with your service and follow up program.
  • Let's not forget payment terms. Our payment terms are:
  • And because I value you as a client, you'll always have my direct phone number.

When you analyze the question 'What will it cost?' you quickly realize how silly of a question it is for the following reason:

They have no idea what it really costs.

Understanding that, you should focus your energy and questions on uncovering the nature, depth and scope of their problems or reasons for the purchase. You can accomplish this by asking such questions as:

  • Why do you what this product?
  • When do you need it?
  • What will happen if you don't have it by that time?
  • What do have presently?
  • Why can't you get by with what you've got?
  • How will you make the final decision?
  • What is most important for you?

Notice that none of these questions can be answered with a yes or a no. They require specific answers and they encourage conversation and based upon the answers they will lead you into asking deeper questions that reveal more vital emotional buying needs.

The success key to selling value and higher margins is to avoid at all costs the questions 'How much does it cost?' You must first uncover the real needs of the potential client for your products or service. Once you've uncovered why the prospective client needs to buy your product or service - and you know the dollar value to their problem - you can offer the solution to their problem and discuss price.

Are you sick and tired of spending all of your time working for your business? If that is the case, and nothing seems to get done unless YOU do it, let me explain your problem and how you can correct it.

Most contractors don't have any systems, processes or procedures that drive their business. Instead, they allow themselves to do the work instead of building leverage by building the systems, processes and procedures and training their people to work the systems, processes and procedures. In essence, the contracting owner becomes the business.

Any construction business can be broken down into its driving processes and sub-processes. Once you've figured out the process driving the activity, you can document, measure and control the process. By simply working on your business, instead of in your business, you can vastly improve your business.

Each and every activity in your construction business, such as, production, finance, estimating, sales, marketing, engineering and operations can be improved from 2% to 2000% by developing and implementing the activity into a process. That translates into enormous, significant and massive geometric growth possibilities. And, every improvement contributes directly to the bottom-line and to improving the lifestyle of the owner.

A recent Golden Hardhat member, Mr. Keith Crocker of Forever Fence Co., recently commented to me that in just four months by implementing just a few of the systems, processes and procedures, he has improved his business and lifestyle over 300%! Imagine the difference once he processes the entire business.

Another Golden Hardhat member, Mr. David Bengston of Lighthouse Construction of NC has exceeded his original plans and will harvest double digit profit margins at a time that his competition is suffering major economic setbacks from a down economy. What is the driving force for his unparalleled success? His dynamic processes and systems!

How do you get started? Start by asking yourself a few key revealing questions, such as:

  • What do you do in marketing?
  • What do you do in selling?
  • What do you do in operations?
  • What do you do in effectiveness?
  • What do you do in management?
  • What do you do in money managing?
  • What do you do in achieving high productivity?

Ask yourself those questions, answer them by looking inside and outside your business and quantify them by measuring how well things do or don't perform, realize the impacting elements and you can improve your business exponentially!

Henry Goudreau, C.S.L.
HG & Associates, Inc
"We turn contractors who dream of a successful business, into business managers who make a business successful!"

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