3 Rules about Budget
By Jack Kasel
- You must have the budget conversation – early!
- Have your prospect put a cost to their pain to validate budget.
- Don’t show your solution until you know the budget.
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By Jack Kasel, Sales Development Expert, Anthony Cole Training Group
There is an age-old debate about which came first – the chicken or the egg. While that debate may never be solved, there is one “Which comes first?” situation that should NOT be up for debate; that is the “See the Solution First or Know the Budget First?” dilemma. Welcome to this week’s Anthony Cole Training Group Sales Brew.
In our work helping clients develop their sales talent, we know there are two topics that get avoided on a regular basis and both are to the detriment of the salesperson. Those two taboo topics are 1) discussing incumbent and 2) discussing the budget. We will address the incumbent discussion in a later Sales Brew.
Now, when we refer to the “budget”, we are referring to it in three categories commonly known as TMR—Time, Money, and Resources. It is our experience that the stronger sales professionals don’t shy away from that discussion. Those salespeople are successful because they follow these 3 Rules:
Rule 1#–Have the conversation. The 800lb budget gorilla is in the room so talk about it. If you have taken the OMG sales assessment, look at the section on “Ability to Discuss Money” to see if that is a weakness or strength. If it’s a weakness, put a plan together to help overcome this obstacle.
Rule #2—Provide context. Regardless of the investment your prospect needs to make to fix their problem, it needs to be framed in the context of their pain and your ability to eliminate it. If the pain is minimal, then your solution won’t seem that great. We’ve had prospects tell us their problem is a “two comma” problem, meaning their cost of turnover was over $1 million dollars. That’s context. Know their cost before you proceed
Rule #3—Don’t show your solution until you know the budget. It’s really that simple. If you have ever provided a solution to a prospect only to hear them say “that’s more than we intended to spend”, then you have an issue discussing the budget. Doesn’t it make sense to know their appetite for change, including budget, before you provide your solution? Here is where the strong sales professional is different. If the prospect doesn’t want to discuss budget, they know it will generally be for one of two reasons: either 1) you haven’t uncovered enough pain or 2) they simply want to use you as a pencil sharpener for the competition. You don’t get paid to be a pencil sharpener… so don’t become one.
In closing, don’t be afraid of the conversation. In the history of sales, no one died from discussing budget, so I doubt you will be the first.
Now… there is someone out there that needs what you do, go find them.