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Posts Tagged ‘value selling’

B2B Sales Video: Reduce Cost or Increase Revenue?

by Victor Antonio

When we’re presenting to a client, there are generally three areas where our product or service solution might be able to help:

  • reduce the client’s costs
  • increase the client’s revenues
  • help the client avoid missed opportunities

Which of these (3) do you think will carry more weight (i.e., is more believable) with the client?   This video answers that question.

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ROI – Defining the Impact Areas

By Victor Antonio


Sales Consultant, Victor Antonio, Value Centric SellingIf you’re in the ‘Systems Automation’ business, then one of the best ways to prepare for a sales presentation is being able to define the areas of impact your product or service will have on the client’s direct costs or operating expenses.

A mistake many B2B salespeople make during the presentation and proposal phase of the sales process is to present their product/service/solution and slightly touch on a few possible impact areas.   Mistake!  Don’t make the client work at having to connect the dots between what you offer and their problem areas; that’s your job!

To be able to do this effectively requires some upfront thinking and preparation.  Start by listing out all the possible areas of impact your product or service addresses.  For example, let’s say you offer an automation product or software that will automate steps in the client’s manufacturing process or automate steps on the processing-side of a service-based business.

Here’s a short list of some the areas are you most likely to impact:

  • Reduce Rejection Rates
  • Reduced (Wo)Manhours
  • Reduce Headcount
  • Reduce Maintenance Cost and/or Fees
  • Reduce Number of Suppliers (in supply chain)
  • Reduce Material Expenses
  • Combines Processes to Reduce Cost
  • Reduce Human Error (reduce handling)
  • Reduce Utility Cost
  • Reduce Workstation-System Workspace (area)
  • Reduce Software Application Licenses

Can you think of a few more?

Once you’ve compiled a complete list of impact areas, the next step is to analyze and assign each impact area a value (e.g., estimated number of hours reduced, dollars saved, days reduced, area utilization, and so on).   Lastly, incorporate these reductions and savings into your presentation and proposal.

If done correctly, you’ve just moved up one step on the VCS Value Ladder.  What is the Value Ladder?  Well, that’s another posting altogether 🙂

The Value Conundrum: Cost Savings v. Revenue Increases

by Victor Antonio


create value by cutting costWhen selling a client on value, you’re left with either showing the client how you can reduce their cost or increase their revenue.   Either way, what you’re proposing is a way for the client to improve their profit margin.  Convincing a client that you can help them reduce cost is a far easier sale then convincing them you can help increase their revenue.

Which creates a ‘value conundrum’ when it comes to selling value.  More often than not, clients value a company that can show them how to increase their revenue more than they do a company who can help them reduce their cost.   That said, leading off with a strong cost saving strategy for the client will give you more sure footing than trying to convince the client that you can help them increase sales.  Three reasons why this is so:

1) In general, cost savings are always easier to quantify as compared to a potential revenue increase.  Because they’re easier to quantify (i.e., more objective and tangible), the client is more inclined to believe what you the salesperson (or Business Development) is proposing.

2) Clients know that they have more control over reducing cost than increasing revenue.  Showing the client how your product(s) can help them control their cost give the client a sense of control and ownership of the results.

3) Cost reduction are perceived to have more permanence compared to increase sales/revenues.  When a cost saving measure is implemented, it’s more permanent compared to an increase in potential revenue.

So although cost savings take a backseat to increase revenues when it comes to positioning your product, having the former gives you a stronger position from which to present from.  When selling the advantage of your product or service, lead with cost saving metrics because they’re easier to justify and defend compared to promises of increase revenues if they buy.

Value Centric Take-away: When presenting to your client, lead with cost saving proof and then introduce potential revenue increases they’ll derive from buying your product or service.