Discounting is NOT Negotiating!

May 16th, 2016 by Richard (Ric) Franzi, MBA

2016-05-10 Jeff GoldbegJeff Goldberg, Master Sales Trainer, E Center Training and Development. spoke to my 2nd Tuesday Peer Group® about the most effective ways manage and lead a sales organization.  Jeff has presented to 2 other of my CEO Peer Groups® with great response and lasting impact.  This talk was no different, as Jeff answered questions from each attendee about their “#1 Challenge Managing Sales”.  I wanted to share a few of the key takeaways from his 1-hour talk to my members.

Sales People Are Like Children

Jeff made this challenging statement not to insult professional sales people, but rather to help leaders understand how to effectively lead their sales teams.  Here are his key reasons to support his view:

-Salespeople need you to celebrate their successes in a big way.

-The need to be supported when things go badly for them.

-Salespeople require their managers to be willing to speak directly to them and for the manager to be willing to have uncomfortable conversations to ensure there is a clear understanding for their expectations.

-Building on the previous point.  Jeff said that to lead sales teams you must be willing to be unpopular, at times, with them. Leading sales teams is not a popularity contest, it is a business and the sales team has to deliver results for the good of the entire organization.

-Anytime you want a salesperson to do something for you (the company), you need to show them why it is good for them (the individual).

You Don’t Manager by Results…You Manage by Activities

-Over time you must determine, by salesperson, their required activities to achieve their bottom line results.  Each maybe different, and you need to know what they should be doing each day to achieve the goals you have set for them.

-The reward of hitting a salesperson’s quota is they stay employed. Achieving their sales goals is the minimum level of acceptable performance.

-You should always celebrate the “small activity wins” as it effectively reinforces the activities you seek to have them do.

-You, as their leader, must know the individual salesperson’s personal goals to be derived from their success at work.  Personal goals are the ultimate motivating factors for any salesperson.

-Fear is NOT a good long term motivator.  Over time, FEAR is debilitating to the sales organization and will not build a lasting high performing group.  It may work, at times, in the short term.

Not Every Company is Your Company’s Prospect

-Ask questions as early as possible of the salespeople to understand if their prospect is your firm’s type of client.  Salespeople may have a tendency to chase the wrong accounts if they are not crystal clear on what the criteria are for your firm’s ideal clients.

-Discounting by salespeople is NOT negotiating! You have to make sure your salespeople understand and believe in your company’s value otherwise they will offer discounts to win business that are unnecessary and damaging to your profitability.

-If you charge a premium, when compared to your industry, your salespeople must be willing to explain why your pricing is justified.  You must ensure that your sales team is willing to “walkaway” from business that does not meet your firm’s pricing/profitability goals.  Too often, salespeople are given pricing/discounting authority that is far beyond their pay grade.  Limit or remove all pricing flexibility from your sales team.

The members truly enjoyed and derived tremendous value from Jeff’s talk. You can find him at E-Center Training and Development.

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