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“How Much Do You Want To Spend?”

by David Brock on March 18th, 2014

“How much do you want to spend?”  “What’s your budget?”  These and other questions are classic qualifying questions sales people ask.  To tell the truth, these questions have always bothered me.  The only logical answer a customer can give to these questions is, “As little as possible.”

The other problem with this approach, is in qualifying, we are setting up the discussion through the sales process to focus on price.  Early in the discussion, we focus on price, it can only continue focusing on price.  Additionally, paying what we are selling is just a portion of the overall funding they will be looking for.  The customer has their own implementation, change, and project costs.  These may actually be the real “showstoppers” to a project.

I think there are possibly better ways to qualify opportunities.

I started thinking back to times when as GM of a Division, or CEO,  I had engineering, manufacturing, and other functions reporting to me.  VP’s and project managers would try to “pre-sell” me on projects(at least the smart one’s did).  As they started looking at a new project, rather than asking me to reserve budget money to buy something or make a change, they focused me on the preliminary business case.  The discussion focused on what they wanted to achieve, how it fit their goals and our overall plan.  They would have a rough idea of the overall project investment, seeking my approval that we could get funding for it and it was at the top of our priorities.  If I gave the thumbs up, they would go into their detailed planning, coming back to me later for project approval and funding.

It seems doing something similar with our customers might be valuable.

While it is a bit of a circuitous discussion, the real qualifying questions–both from a budgetary/funding point of view and a customer urgency view—need to focus on the outcomes desired.  Questions like, “What’s your target for improving manufacturing productivity over the next 2 years?” “How much would you like to reduce design cycles in the next 12 months?”  “What revenue improvement would you like to see as a result of these initiatives?”  The list goes on, but rather than focusing on the price of the solution, it focuses the conversation on results and outcomes produced.

If the customer establishes these goals, that’s only part of the qualification challenge.  We also need to understand and get them thinking about how they get funding for investing in programs that produce these outcomes.  Questions like, “How do you get funding for these types of projects?”  “What was the funding process for similar types of projects in the past?”  “What is the current commitment for funding for this project?”  “What other projects will be competing for these funds?”  “What are the consequences of not doing this project?”

A lot of these are questions we may discuss early in discovery, but I think they are better qualifying questions and better address the “budget” issue.  We and the customer need to understand these as early in the buying process as possible.  They also focus us on the issues the customer faces in getting project approval, rather than our issues–do you have money?  If the customer isn’t thinking about these issues, they won’t be successful and we won’t be.

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3 Comments
  1. John Sterrett permalink

    Exactly. I ask, “What is your product failure rate? What would you like it to be? How would it improve your market position to be able to extend your warranty to 10 years from 5?” All value-based questions which frame the conversation and make the discussion about improving the customer’s bottom line, not about the cost of a commodity.

    • Great ideas, qualification is less about the money the customer will spend on us, but the urgency and ability they have to address an opportunity or make a change.

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