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Selling a Price Increase:

Dealing With A Purchasing Department
  1. Never sell to just the Purchasing Department.  Always know who the user is and insist on having a working relationship with them.
  2. Never allow the Purchasing Group to control the flow of things.  Insist on remaining in control and having them work to your timeline unless there are real concessions you can achieve.
  3. Know what the cost of switching is.  Purchasing Departments will always be quick to say they can find a new supplier, but they rarely go through the process.
  4. Know the cost of your money before starting the process.
  5. Know what your walk away point is at all times.
  6. When the Purchasing Department wants to scrutinize your pricing, resist the urge to break it down by individual item or service.
  7. Display confidence, but not arrogance.
  8. Never go over their head without telling them first.
  9. Purchasing groups routinely share information with their peers.  Know in advance what they will find out about you and your company.
  10. Treat the Purchasing Group with 100% professionalism and integrity.  Because they deal with so many salespeople, they learn quickly who they can trust.
  11. Sell first, negotiate second.  Keep the discussion on the benefits.
  12. Purchasing Departments strive to commoditize everything.  Avoid discussions that focus on product features.
  13. Price increases are sold in advance.  Don’t bring surprises to a purchasing agent.
  14. Know how the Purchasing Department is evaluated, both as a whole and individually.
  15. Know the financial parameters the Purchasing Department has to work with.
  16. For each point you present, always have supporting data that you are comfortable leaving with the Purchasing Department.
  17. Purchasing Departments will rarely have as much expertise as you do about what you’re offering them.  Although they will not admit it, they do want and need to know how your products / services will impact their company.
  18. Know every detail of your supply chain.  This is a key area Purchasing Departments are concerned with.
  19. Do not allow the Purchasing Department to block your way in learning more about the company.
  20. Accept the fact that Purchasing Departments are financially-driven.  Know their financials better than they know their own.

 

Mark has recorded two audio podcasts that further elaborate on this information.  Click on the links below to hear them.

Purchasing Department Part 1

Purchasing Department Part 2 

 

Mark Hunter, “The Sales Hunter”, is a sales expert who speaks to thousands each year on how to increase their sales profitability.  For more information, to receive a free weekly email sales tip or to read his Sales Motivation Blog, visit www.TheSalesHunter.com.

 

Reprinting of this article is welcomed as long as the following is included: 
Mark Hunter, "The Sales Hunter", www.TheSalesHunter.com,
© 2008


Other articles regarding Selling a Price Increase by "The Sales Hunter" that you might find interesting include:


Selling a Price Increase in a Soft Market

Maximizing Your Price - The Value/Benefit Equation

The Price Increase Switching Game

Pricing Timeline

Selling a Higher Price in a B to B Environment


Price Cutting is for Sissies

Maximizing Your Price in a Soft Economy


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