What are some ways a salesperson can speed along the procurement process when dealing with large Fortune 1,000 companies? #Q&A
We’re seeing major lag times with large customers from the time we have a “handshake” agreement and when our deals actually get through a large company’s procurement process. We’ve stripped down our MSA/SOW document, but find that most large companies prefer to use their own document. Our changes tend to be fairly minor, however, we’re seeing that the back-n-forth can take 3+ months or more in some cases. Is there anything we can do to help speed things along? I’d love to get some answers from people who work in procurement.
Make sure you are selling to the correct person.
If a senior manager is brought into your solution, there should be no delays. Take the extreme case — If Tim Cook at Apple decided that he wanted to use a new vendor for iPhone production, do you think it would take a long time to have Apple’s procurement team approve the decision?
If you are finding the procurement process is taking longer than expected, it may mean that you’re buyer is a lower-ranking manager that hasn’t purchased frequently (if at all) from vendors and they don’t know the fast-track to approvals.
Your prospect may be using “procurement” as an excuse to gaining approval from her manager for budget while purposely withholding this information from you and now they’re too embarrassed to tell you otherwise…
Take control of the procurement process
Ask for the names and contact info (email AND phone) for the legal, accounting, and vendor management personnel from your prospective client once you reach the “handshake” milestone. This prevents the additional layer of communication from you to your buyer to the internal team, then…
Host a “Procurement Kick-off” conference call with your prospect and their legal rep, accounts payable manager, and vendor manager.
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Position this call to your buyer like this:
“I’m sure that your legal/procurement team will have questions of our legal/procurement people. To expedite that, let’s have a 15-minute conference call between you and your team and me for an introduction.”
During this call, ask these questions about their process:
- “What is the normal turnaround time for this sort of process?” This will help you manage your expectations. Sometimes, it simply takes 3–4 months from your buyer. That’s just the way they do business.
- “What are the 2–3 stumbling blocks that slow the approval process when you are setting up new vendors?” This will provide you with landmines to avoid.
- “Do you have a Master Vendor Agreement that you would prefer we use instead of me sending our SOW?” Chances are that your prospect has spent many hours and lots of dollars protecting themselves and the odds that your home-grown SOW matches up with their requires is pretty small. Start with their template to avoid over-zealous red-lining of your document by their team. You can always all Appendices and Exhibits to their Master Agreement to include key information from your SOW.
Schedule an update phone conference once a week or every two weeks at the onset of the procurement process. Tell your prospect — “I know this is important for both of us, so setting up these short conference calls will help us all stay on point.”
Write a summary email of action steps and expected completion dates at the onset of the procurement process, then use this as a working document during your scheduled conference calls.
Remember, the procurement team has performance ratings as well. If they take a long time to approve new vendors to the frustration of business managers, this will hurt them personally over the long run. When you show a vested interest in helping them expedite an agreement, they will appreciate it.
PICK UP THE PHONE (yes, caps intentional!)
Once you are in a back-and-forth banter with the prospect’s legal team on changes and red-lining, whenever you receive an inbound email with suggested changes, PICK UP THE PHONE and call the person immediately to clarify.
If you fall into the email trap, by the time you type a response and send it, your counter-party might be gone for the day or onto the next project. You are probably 1 of 20 projects for that person. When they send the email, you know they’re thinking about you — everything is fresh in their mind.
(Not to mention the personal relationship you’ll develop by actually talking with someone vs cold emails…)
Consider providing your service to your client in parallel to the formal approval.
This might include account setup, training, and other assistance that will achieve lock in and thus provide an incentive for your prospect to push the approvals through.
BE CAREFUL though — set a date by which you will suspend service if the procurement process is not completed. If it is agreed during your “Procurement Kick-off” meeting that you will have the executed contract and initial payment completed by a certain date, set this as your suspension date and put this in an email and continue to mention it during your “Procurement Update” meetings.
Begin the “Business Sale” during the “Technical Sale.”
This concept is described by Brian Burns in “Selling in a New Market Space.” (www.amazon.com/Selling-New-Market-Space-Innovative/dp/0071636102) If you are progressing the “Technical Sale” with your prospect, then propose that you initiate the contract process to help to accelerate the approval once a final decision is made.
Be careful how you use this — avoid it too early in the process else it will make it appear you are attempting an “assumptive close” with your prospect. Use your intuition. Perhaps you’ve completed a complete product demo to your prospect and her team and she’s giving you the signals that this will be approved by senior management. At that point, suggest that while she is scheduling time with senior management to present (which may take WEEKS because of schedules), you would like to have a preliminary call with your prospect’s procurement team to have them preview your Statement of Work for any show-stoppers or suggested language changes that they know will be required.
**This Q&A article was originally posted on Quora. Check out Scott’s Quora page here.