how to avoid being commoditized by procurement
TRANSCRIPT
5 Tactics to Use with Procurement
SALES NEGOTIATIONS:
• Dealing with third party negotiators
• Blind RFP’s
• Reverse auctions
• Commodity pricing
• Hardball sales negotiating tactics
Sales negotiations with Procurement is an ongoing struggle:
By understanding Procurement's objectives…
It’s easier to work with Procurement and achieve a successful sales outcome
5 Common Negotiating Tactics
used by Procurement and their
Counter-Tactics
Deflect or Discredit your Value Proposition
1PROCUREMENT TACTIC:
To deconstruct your value proposition so that they can then compare prices among vendors
PROCUREMENT GOAL:
Build stronger relationships with the business unit buyer
COUNTER TACTIC:
Develop strong customer coaches and present a
compelling business case for your solution
COUNTER TACTIC:
Commoditize and Control Responses
2PROCUREMENT TACTIC:
Procurement want to do an apples-to-apples comparison with your competition
PROCUREMENT GOAL:
You need to convince the business unit buyer
your product is different
COUNTER TACTIC:
Employ a value based sales approach that quantifies the overall value of your solution
COUNTER TACTIC:
Present a total solution that can’t be dismantled into component pieces and
commoditized
COUNTER TACTIC:
Limit Access to Business Contacts
3PROCUREMENT TACTIC:
Procurement doesn’t want a business decision that undermines or supersedes the procurement process
PROCUREMENT GOAL:
Build a strong network within the business organization
COUNTER TACTIC:
Leverage inside and outside resources before Procurement
puts a gag-order on the vendors
COUNTER TACTIC:
If you’re told you can’t contact anyone outside of
the RFP process...
...you have a business decision to make in terms of the
risks and rewards of following those rules
Use Past Performance Against You
4PROCUREMENT TACTIC:
Procurement likes to have information about vendors to drive down prices and negotiate a commodity deal
PROCUREMENT GOAL:
Be proactive. Anticipate issues and concerns that may come up and have your responses prepared
COUNTER TACTIC:
Good Cop/Bad Cop and Mystery Decision Maker(s)
5PROCUREMENT TACTIC:
Procurement present additional decision makers or hoops to jump through late in the process
PROCUREMENT GOAL:
Determine who all the decision makers are and how the decision will be made
COUNTER TACTIC:
Procurement wants to keep all of the vendors in the
game as long as possible in order to provide
leverage against the competition
Sales professionals typically have more power in this situation than realized
Don't let your sales solution be diminished or commoditized by Procurement
As a sales professional, you must be prepared to
counter these tactics…
…by planning, leveraging your relationships, and reinforcingthe shared interests and value proposition for your customer
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