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Quantifying The Problem and the Pain

October 30, 2015

Sales teaches to focus on the problem or pain.  However, if you have not quantified your prospect’s problem, you are definitely losing a lot of sales with typical excuses like “cost too high” and “not ready yet”, or “not in the budget”.  Quantifying the problem is so important,  not only the sales person, but  more importantly, for the prospect.  Quantifying a problem has to result in an ROI (return on investment), and consequently, dollar savings.  It changes the perspective of your product or service from something of cost to an investment.  Quantifying can be difficult and it may start with some assumptions.  There may be a soft cost which starts with percent of time lost, employee absenteeism, percent of rework, yield loss, employee retention, down manufacturing time, or down computer time.  However, unless it is quantified into dollars it does not become total reality.

If you are selling to an engineer or an IT person who has to get approval from a CFO, you will be helping them overcome objections and talk financially.  Don’t be as concerned about their budget as much as quantifying their problem.  Until you  put a dollar number to their problem, your solution has not solved anything.  Your solution may cost more than the problem, and you don’t even know it.    However, it is quite possible that the company can have a ROI which justifies investing in your solution, even though it is way beyond what they have budgeted.  Here are 3 quick examples:

  1. A great example can be seen by   MyPCReports Mr. Jones developed a profit calculator on Employee.  He shows that, if you have 10 people making $60,000 and they waste one hour / day, the company has lost $75,000.
  2. Suppose you are walking into a situation where there is a lack of yield.  Let’s say the customer says that it is 2%.  What does that mean in dollars?  Multiply it over the course of a year, then ask how many years this has been going on to get a truer picture of what the yield loss means.  Now, instead of talking so much about your solution cost, you now can talk about and focus their attention on their ROI.
  3. This applies to almost any situation. Replacing windows saves energy.  How much?  I don’t know, but one can guess about 20%. (Would this statement be stronger as a researched industry average for AZ?) Now take the average monthly energy bill multiply by 12 months and then multiply by 20% or (0.20).

ACTIONS TO TAKE:

  1. Get industry statistics on your particular  industry’s problems and opportunities.
  2. From this, develop a calculator with your salespeople for various situations where your product or service saves time, trouble, or money.
  3. Incorporate into your Sales Process this question:  “Have you quantified this problem with the client?”
  4. Review, Revise, and Improve the Process.

If you would like to have a short free consult on quantification for your particular business, please send me an e-mail, text or call at 480-220-4296.  I am looking forward to your thoughts and ideas.

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