September 08, 2009

Buyers buy from big vendors, Have You Any Hope Selling?

According to professional buyers and some very successful sales people small to medium sized companies have a huge problem selling to big companies right now. So this post raises two questions: Why is this so and what needs to be done?

It’s all about the language you speak

SME product and service providers don’t face the same challenges their prospects face. One sales person sums up the challenge well “working for a large organization we experience the same pressures as the people we sell to, we need to get a 2-3% cost reduction and drive efficiencies while ensuring customer value is maintained and so do our customers. They know that and we know that. We speak the same language as the executives we meet (e.g. capital costs, Capex, Opex, IRR) while most of the smaller specialist providers tends to focus on the benefits their offerings deliver.

Pack up your tent and go home or help the buyer buy?

The buyers and sellers we talk to are not suggesting for minute that SME’s can’t sell successfully to big companies, what they are saying is the SME’s sales teams needs to put a lot of thought into their message and approach when dealing with executives in big organisations. The team targeting an executive in a major corporation needs to be clear that demand creation is their job, the executive won’t say “here are my problems, please help me solve them”. (The Authors of Spin, Huthwaite have some really good papers on the topic of demand creation).

In the current climate big companies are looking to do more with less and the buyer will only work with an SME’s who can prove measurable impact quickly. That means they need to speak fluently about their ability to affect the business case that is being discussed when they are not in the room.

As one buyer noted in a conversation with us last week “the fact right now is big companies are not willing to take risk without an almost guaranteed payback and rock solid business case. A small vendor who doesn’t clearly present measurable benefits and an understanding of costs and risks will not succeed in this cautious environment”.

Fear, uncertainty, doubt– centre stage again

Big vendors are good at reducing fear, uncertainty and doubt and they will not be shy about raising the risk stakes if it means they can take a larger share of project spend from a smaller more nimble provider. You may not believe this but some buyers are still comforted by the fact they can sue somebody big if a project goes wrong.

All is not lost – buyers like to buy from specialists

All of the above, size, trust, risk, the business case, the words you use has implications for your route to market, the people who sell for you (at the right time experience selling to major corporations may be needed in your team), how you target your message and in many cases the SME founders willingness to develop partnerships with established players who can reduce risk in the eyes of the customer.

Some of our SME’s clients are selling to the big boys; their success seems to be based on their willingness to;

  • Find the right solution for their customer,
  • Align to their buyer’s decision making process,
  • Learn how to speak their customer’s language,
  • Work with bigger partners who compliment their offerings,
  • Adopt a road warrior mindset.

Food for thought.

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