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"Lost sales: What a waste! Let's only work on the winnable ones" - Interview by John Smibert
Businesses regularly spend up to five times longer losing a sale than winning a sale (EY). Wayne Moloney explains why this is so - and what we need to do about it.
In particular he emphasises the need for a stringent qualification process to ensure we know our opportunity is winnable.
He said "Spend your time on opportunities that have got the greatest chance of success". To help make these decisions he offers us some simple qualification questions that will assist us determine if we should invest in furthering the opportunity.
Wayne Moloney is a leading business strategist specialising in sales and business development. Wayne has a very specific specialisation in 'lean selling'.
See more of the 'TALKING SALES' series here
John: Welcome back, Wayne!
Wayne: Thanks, John!
John: Last time we discussed waste, and how to look for and eliminate waste in the sales process, part of the 'lean selling' process.
John: One of the things you touched on was the waste in working on opportunities that never go anywhere, that never get to a conclusion.
Wayne: Yes, people can waste time on opportunities that really should be qualified out early. An interesting statistic came up last year - Ernst & Young here in Australia did some research on sales processes and on sales individuals. They found out that businesses could spend up to five times longer losing a sale than actually winning a sale.
Wayne: And that comes down to poor qualification.
John: I guess it does, I guess it does.
John: I mean, I'm as guilty as a lot - I've worked on a lot of deals in the past, and...
Wayne: Haven't we all?
John: Yeah, multi-million dollar deals that we'd work on for a year or two, and we lose it and we go back and look at why we lost it; either we shouldn't have been there in the first place, or we got our strategy wrong.
Wayne: Look, you can really break it down to four very simple questions- "is there an opportunity? Can you compete? Can you win? Is it worth winning?" They're four simple questions that I carry with me on every opportunity that I look at, every time I talk to a prospect.
John: Great questions, yeah. Great questions. I think I've heard you call it something.
Wayne: Yeah, I turned that into an acronym, BANTA. That really just comes down to - BUDGET, is there money allocated to the project that you're looking at, and is there authority to spend that? That leads into AUTHORITY. Are you dealing with influencers and decision makers? Bear in mind, this may change throughout the sales cycle. The person you start dealing with as an influencer may need to change to be the decision maker.
John: So qualification is not a one-off exercise early in the sales process, it's a continuing process.
Wayne: Absolutely. The same as with need, so B-A-N; the NEED. That need could change slightly as well, because as you move through the individuals that are involved in that decision making decision-making process you may find and uncover that they've got slightly different needs to the person you were talking to before. Are you delivering something that will solve the problem that they've got?
John: It's tough for a sales guy though, isn't it? You know, I've got a deal that I'm working on, I've already invested a few months and whatever. It's tough to make that decision to say "Hey, let go - find another one in the funnel."
Wayne: Yes you've got to make those tough calls. But that comes down to the timeliness as well. You know, does the client have a TIMEFRAME for purchase? You may have heard it referred to as a compelling event.
John: I call it a compelling event all the time.
Wayne: Exactly, yes. So, is there a time frame to purchase? Now, if there's not and there's no compelling event then maybe it's time to cut your losses and get out. And the last one, the last "A" is "ATTRACTIVE", and that comes back to value again. Is what you're delivering attractive to the person that you're making the sale to? If it isn't then you need to have a look at it and say "Am I really delivering value that this customer will find attractive?"
John: So, bottom line: if we look back on the Ernst & Young statistic. What was it, five times as long to lose an order as to win an order?
John: If something's happening along that, a lot of waste is occurring, and our productivity is going to go down.
Wayne: Spend your time on opportunities that have got the greatest chance of success.
John: And if you haven't got those opportunities in your funnel go find them.
John: Don't waste time on the ones that you're not going to get.
John: Love your advice, Wayne - thanks for talking with us! Look forward to our next discussion.
Wayne: Pleasure, John - thank you!
More interviews with Wayne Moloney:
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