The True Meaning of B2B Sales

Last Updated Sep 30, 2008 9:16 AM EDT

Revenue and Profit
I recently received a thoughtful comment from a contributor (handle: "Ray892244") that identified the five areas that are key in B2B sales. Here's an excerpt:
B2B sales, as we teach it to our clients, is heavily dependent on an ROI analysis. The numbers used in the ROI analysis are the customer's numbers, gathered through effective questioning. We teach our clients' B2B sales people to look for ways of contributing to the prosperity of their customers' business in five areas: (1) sales, (2) employee or process productivity, (3) profits, (4) competitive advantage, and (5) cost control...If a B2B salesperson is talking about anything other than those five issues they are probably wasting their time and their customer's time.
Those five elements are interesting because they're a map of what most companies think are important -- and therefore provide hooks for B2B selling. However, I think that list may be a bit over-elaborate.

I maintain that there are only two (2) goals inside every company: 1) increasing sales revenue and 2) decreasing cost of sales.
To illustrate this point, let's look at the five elements that "Ray892244" kindly provided:
  1. Sales. Nobody wants to decrease their sales, so this element is simply a restatement of the goal to increase sales revenue.
  2. Employee/Process Productivity. Increased productivity decreases the cost of doing business, thereby decreasing the cost of sales. If you increase productivity somewhere in a company in such a way that it increases the cost of sales, you're decreasing profitability, which is stupid.
  3. Profits. Increased revenue and decreased profitability means more profit, by definition.
  4. Competitive Advantage. Any idiot can beat a competitor by giving away more value for less money; the trick is to grow at the competitor's expense and still remain profitable. Therefore, competitive advantage consists entirely of increasing revenues while either decreasing the cost of sales or keeping them stable. Even product development (building a better mousetrap) is actually just a way to increase revenues by making more sales.
  5. Cost Control. You'd have to be an idiot to control costs in one part of company in a way that ends up increasing the cost of sales and/or decreasing revenue. Therefore, the only meaningful cost control consists of decreasing the cost of sales.
To repeat, there are only two (2) things important in a company: 1) increasing sales revenue and 2) decreasing cost of sales.
Everything else is hogwash and biz blab.

Therefore, if your B2B offering focuses on helping your customer do either of those two things, you've got something that's worth buying.

And if your product does both of those things, you've got a real winner.
  • Geoffrey James

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