Help! My Firm is Being Outflanked and Outsold
This Sales Machine reader has a problem. She's got a great product that's better than the competition, but she's still is struggling to close deals. Here's her email, followed by my suggestions. Anyone else care to chime in?
We sell Screening & Crushing Equipment to mining operations, sand & gravel companies, mulch processors and recycling operations, etc. Although we have a website, we do not get any business from it but instead depend upon outside sales.You have two major problems here but both have the same solutions, which involves some fairly substantial changes to your sales approach.
Our sales presentations go really well until we tell the prospect the price. Then the prospect goes to an Equipment Auction and buys it for half price. Then they call us and ask us how to fix it or run it.
Our competitors have equipment priced less, but it breaks often, is much slower than ours. However, our competitors have huge inventory and are able to rent to own programs. Unfortunately, we do not have financial resources to do this.
The first problem is that the equipment that you sell (or the equivalent) is available cheaper from another source. The second problems is that your competitors can offer an option that you can't, which makes their offerings seem more attractive.
To solve the first problem, you must change the way that you charge for your products. You must stop selling the "Equipment" and instead sell a "Screening and Crushing" solution. This is an important distinction.
When you sell the equipment, you are devaluing the important part, which is making the equipment run reliably and consistently. Furthermore, you get yourself involved in a price war with another channel for that physical object.
From here on, when you present, you price the "equipment" portion of the solution at (more or less) the price that they can get the same equipment at auction. But you sell it bundled with a contract for training and maintenance, and make it clear that they can't get those if they don't buy from you.
To solve the second problem, you need to create an ROI argument. You need to show, with quantitative data, why it's less economical to rent a substandard piece of equipment than to buy a complete, high quality solution.
To do this, you build a comparison, showing the competitor's breakage rates, and low flow rates, and the cost of those stoppages and slowdowns, as they balloon through the entire mining operation. You present this data along with a story about a real customer who got burnt (you've got one of those in your hip pocket, right?)
None of this is terribly difficult, but it does require you to rethink your business model and how you present your offering. I'm willing to bet it's all "features and functions" rather than the business case for buying your solution versus the other choices.
READERS: Any further suggestions?
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