As sales professionals, our time is our most valuable resource. How we invest that time will ultimately determine our success in sales.
Have you ever been excited about winning an opportunity, but then had to spend a great deal of time with your customer post-sale, work with others at your company to implement the solution, only to find out that after all your hard work, the deal didn’t make much money after all? If so, read on.
How can sales reps assess which opportunities to invest their time in? Which ones will be worth their time? Which ones are a waste of their time?
To answers those questions, we need to determine if:
- The sales opportunity is real
- I can win the opportunity
- The opportunity is worth winning
We outlined the 4 step process for sales reps to answer that first question in the recent blog, “How to Determine If Your Sales Opportunity is Real”. Then we covered the 3 factors sales reps should examine to determine honestly, “Can I win the opportunity?”
Now, in the last installment of this series, we’ll help sales reps navigate the final qualifying question, “Is the opportunity worth winning?”
This series is intended to help sales reps learn to manage and maximize their resources by choosing the right opportunities to pursue.
How to Determine if the Opportunity is Worth Winning
To avoid wasting time after the sale on opportunities that cost you time but don’t make you much money, there are three questions to consider:
#1 – What is the total opportunity?
In order to accurately decide whether the deal is worth winning, sellers should examine and assess the total opportunity (current + future).
Small opportunities can be so easy to close that it’s tempting to focus our efforts there. And while those deals are real, and can be worthwhile, we need to make sure that’s actually the case.
If the current opportunity is small, but will grow to a larger purchase in the future, it might be worth pursuing.
However, it often happens that a seller gets “sold” by a client on the idea that a small, current opportunity will eventually turn into a much larger deal down the road. This may even be a genuine intention of theirs, not a negotiation tactic, but that doesn’t mean it will come to be.
Any number of the factors at play could prevent that future business from coming to fruition. Pay attention to whether or not the person you’re talking to has the ability to deliver on the promises they’re making on future business. What is their circle of influence?
There is a probability that the larger deal can happen. What is that chance? Ask. Find out.
This is a mistake that I see sellers make all the time. They determine that the small opportunity is real, but don’t scrutinize how likely the future business is. Be sure to verify that the future investment being promised has real potential – otherwise the opportunity may be not worth your while.
Be cognizant of the truth and diligent about uncovering it. Be aware of the real commitment size and scope, and pursue the opportunities that fit with your sales goals.
Bottom line, it’s important to accurately assess the true, total opportunity when determining if the sales opportunity is worth winning.
#2 – What are the required resources after you win?
In my experience, salespeople that are positive are more successful. They believe they can be and they focus on what can go right, instead of what could go wrong.
But I’ve also seen this backfire. Sellers can overextend themselves, their business, and their resources on an opportunity that isn’t necessarily worth it.
To avoid this, we should consider asking ourselves, “What are the required resources if I win this deal?”
As sellers, we need to be careful and critical about understanding the resources required after the deal is won. Because some deals aren’t worth winning, even if the total opportunity is where it needs to be.
The resources required to deliver on the opportunity won can suck you in and require too much from you and your organization. It can hurt you politically within your company if you have to reconfigure your solution to “make it work.” You may be able to make the deal happen, but is it worth it? Is it worth the time and energy to “make it fit?”
Sellers can often underestimate what’s required from them personally. How much attention will be required ongoing to sustain the business you’ve won? Will they be calling about every detail or issue? Are you going to have to micromanage/ handhold the account through every small challenge? Is it worth the value to your company? Consider the opportunity cost of the post-sale time you’ll have to spend with the customer.
Why does this matter? Because the simple truth is, not all opportunities are worth winning. Remember, you have a limited amount of time to invest in your sales opportunities. Time spent on one deal is time lost on another. This particular one may not be worth your time.
So pay attention to the warning signs. Pay attention to how your prospect behaves during the buying process – because how they partner with you during the buying process is how they’ll partner with you as a customer. If they’re beating you up for details, demanding certain things/ information, requiring unnecessary and extra work, or are unable to make a decision, this is likely the tone that your relationship will take after the business is closed as well.
Again, this is where sellers need to be cautious and think critically about the opportunity at hand. It may be worth it to invest all that time and all those resources. The deal might be the biggest one that’s come across your desk, and it might be worth everything that will be required of you and your organization. But it might not be, and then it’s time to walk away.
When trying to assess if the opportunity is worth winning, one of the keys is to ask yourself, “What are the required resources if I win?” Be diligent about the questions you ask in order to determine the honest answer to that question.
We’re not saying sellers should walk away from business, we’re just advocating that sales reps go into every opportunity with open eyes.
Think about your resources, those of your team, your company assets, and any other resources that might be required to keep the deal together. Be aware of the truth and ask yourself, is this really an opportunity that is worth winning?
#3 – How profitable is the opportunity?
Obviously, as a seller, if you’re compensated on the profitability of the opportunity, then you’ll care about this factor. But even if you’re not, it’s still something you should probably consider.
Profitability matters when determining if the opportunity is worth winning. Your organization won’t be excited about a seller continually closing deals that are not very profitable. They don’t necessarily want to support that with their time and resources.
Many times, your success as a seller depends on how you work with your internal team. The truth is, you need your team behind you – and your team/ your leaders want to know when you bring an opportunity to the table, that it’s worth everyone’s valuable time and resources to support you in winning it.
So look at the profitability of the opportunity. To the company, this is what matters – it’s what they care about. (Unless they’re just working on market share and market penetration for the moment). But typically, your company’s main concern is profitability. It’s why and how they’re in business, it’s why you have a job.
To position yourself well in the organization, think about what they think about, which is profit.
Both parties, buyer and seller, should win when a deal closes. Your solution has value, and if you/ your company can’t profit from an opportunity then it’s not a good fit.
It’s important to continually evaluate throughout the sales process, across opportunities, “Is this deal worth winning?” And examining profitability is a great way to do so.
Summing It Up
Over the course of this blog series, we covered a lot of information geared at helping sales reps determine:
- “Is the sales opportunity real?”
- “Can I win?”
- “Is the opportunity worth winning?”
When trying to determine if the deal is indeed worth winning, remember to focus on the total opportunity, figure out the resources that will be required if you win, and assess the profitability.
It’s so critical for sellers to invest their valuable time in opportunities that are worthwhile. We hope this information has given you some tools to help you determine which deals are worth closing, and therefore worth pursuing.
Sell smarter, not harder.
Do you and your sales team need help learning more strategies to convert the unreceptive and disinterested customer? We’ve designed a program for the toughest challenges in sales.
If you’re interested in reading more, check out our new book, UnReceptive, to help you find, convert and grow more customers by eliminating the hard sell. It ships from major retailers on Nov 9th, so be sure to secure your copy today!