One of the major pitfalls of the proposal process is its cost. Presentations are costly in several ways:

• The time it takes to develop a proposal costs money. It may also cost you indirectly because it limits the time your people can spend in pursuing other, perhaps more profitable, opportunities.

• Good presentations require professional quality visual and print materials that cost money to produce.

• A long-term cost of the proposal process results when you successfully bid for a job that isn't profitable.

If the potential is good - that is, if you find there is a good fit with your core competencies and acceptable profitability - it is possible to limit the cost of proposals. For example, save time and effort by having the core information of your proposals - the information that defines your company's core competencies and value added services - standardized for use in all proposals. Then salespeople can build around this framework to focus on the issues most relevant to the prospect's pain.

When selling without a system, it is difficult to establish an accurate cost for generating a proposal because you can't easily distinguish activities related to proposals from other activities. Using the Sandler Selling System enables you to separate the cost of the earlier steps from the cost of the proposal development and presentation process.

As you know, in the Sandler Selling System the presentation (known as the Fulfillment Step) is the sixth step of the seven step process. This ensures that the presentation demonstrates a workable solution to the real problems and issues facing the prospect, that the prospect has the budget to pay for this solution, and that your company can profitably deliver the solution. The presentation is made only after your salesperson establishes the understanding that the authentic decision maker will be present and will decide yes or no after the presentation. As long as the prospecting occurs in fertile fields - that is, where you have identified a high level of good fit - the effort to engage and understand the prospect is part of the cost of prospecting.

The cost of the proposal and presentation includes:

• Time spent identifying and specifying the relationships between the prospect's pain and the solutions your company could offer

• Research into the competition you face on the proposal and the solutions competitors offer

• Time spent developing an advantageous positioning of your solution relative to the competition

• Time spent writing the presentation and developing appropriate visual aids and support materials

• Production cost of presentation materials

• Time spent making preliminary presentations to members of the buyer's team and getting feedback

• Time spent finalizing the presentation based on feedback

• Time spent in rehearsal and dry runs

• Time spent presenting the proposal

• Travel expenses incurred during the process

The cost of each of these items varies for each proposal, depending on the time, effort, and budget assigned to them and the nature of the solution. You can see that developing proposals and making presentations is not an activity to be undertaken unless there is a high probability of success and an adequate level of profitability.

© Sandler Systems, Inc. All rights reserved.

Missed Any Sales Tips? Visit my Archive