Value Selling Calculations - Can your sellers do the numbers?

16 November 2018 by Charles Howden

Most business purchases will need a financial rationale to support a decision to buy, or switch suppliers. Whether this is in the form of an ROI calculation, or a Cost/Benefit analysis, someone, somewhere (probably deep in the Prospect’s Accounts Department) will be doing the numbers. Wouldn’t you rather your Sellers were setting the structure for this calculation ahead of time? Or can this part of the sales process really be left to chance?

A thought leader in the Value Selling space once observed that performing value calculations can be so complicated that they are beyond most MBA graduates and certainly outside the grasp of most front-line sellers, and he may have a point. Though not all calculations have to be complicated or parsed through multiple iterations.

The first time we set out to show this in a sales workshop, we were working with the CEO of a manufacturing company who had asked us to equip the Field-Sales team with Value Selling skills and tools. Operating in a highly commoditised market, our Client needed their Sellers to be able to sell their premium component products at higher price points than their competitors who were importing low cost alternatives. We had a lot of theoretical knowledge, though at that time, less practical experience of converting this into useable sales tools (Since then, fortunately, with over twelve years of building Value Selling sales models with clients, our tool kit has expanded considerably!).

Ten minutes into our workshop, and sensing that we were not making much progress, we were interrupted by an Operations Line-Manager who asked “So you mean that because our product goes through their machines twice as fast as the product they’re now using, they should pay more for it?” And then from an Account Manager, “Yes, and their clean-down and re-fit time is half the time as well…” And all of a sudden, we were on a roll. A truly “light-bulb” moment! Supported by a couple of Field Sellers who knew the product well, and who could do the numbers (probably) better than us, we spent the morning developing Value Word Equations which converted simple equations into meaningful calculations that Sellers (and Buyers) could understand and use to justify premium pricing.

The key learning from that workshop for us, was that Value Selling calculations don’t have to be complicated (the best ones usually aren’t). And that the source of the calculation can usually be identified by facilitating the knowledge that already exists within the team.

Great Value Selling calculations do not have to be complicated. Simplicity can create a compelling logic that is hard to disagree with, which is exactly what we are trying to achieve when we use value calculations in a sales engagement.

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