Okie dokie. Let`s look at why we want to get a budget, why it is tough to ask for one, and why our prospect doesn`t want to share that information even though there are benefits involved in so doing:
Why, as a seller, I want to get a budget:
- If I have multiple products or services, I want to match the best one to the expressed budget. More chance of making the sale
- If the prospect wants the $800,000 house but only has $300,000 to spend and there is no way to figure out how to satisfy both needs, I`m likely wasting both our times. However, this is also a qualifying tool. While I want the $800K house maybe a dose of reality brings me to the $300k house
- And once again getting a budget is qualifying. They have told me that they are willing to spend "x" dollars. I might then ask them "If you found a product/service that met both your needs and budget, would there be any reason not to go ahead with it?" This would be considered to be a "trial close" that sets the stage for the actual close later. I might also ask "How will you go about making your decision? Will it be based on price, service, what and, in addition to yourself, will anybody else be involved in the decision? When will you be making your decision? How did you plan on paying for it?" These are all good qualifying and budget related questions.
Why, as a seller, I hesitate to ask for the budget:
- Bringing up money is uncomfortable this early in the game
- They may think I am too pushy
- They may say no (same reason that a lot of sales people have trouble asking for the order period)
Why, as the buyer, I do not want to share budget information:
- I recognize that this is a veiled attempt at a close
- I want to make sure that I am getting the best deal
- If I give them my budget they will use all of it
- I don`t really trust the sales person and they might raise the price on a less expensive product because they know I am willing to spend more
- I am out of my element in dealing with this type of product, really do not know what they cost, and I don`t like this feeling of vulernability. I am ripe to be had (smile)
So, we have a variety of dynamics going on here and all are valid. The sales person needs to feel comfortable asking the question and the buyer needs to feel comnfortable in answering. There needs to be a valid reason for both. Putting it into some sort of perspective, right now as I prepare to launch my new venture, I sell custom manufactured signage. And there are a number of different ways to build a sign using different techniques and materials which will largely affect the end price. As an example, I could provide a basic sign for say $10,000 or another one the same size for $30,000. Diffferent materials, different bells and whistles, different looks but do substantially the same thing.
Here`s how I approach this. And I do it at the end of the first meeting after I have gathered all the information I need. "Mr. Smith, I have to ask you a question that I`m guessing you won`t want to answer. It`s about your budget for this project. Now, you may not want to share this with me because you are afraid that if you give me that figure, I`ll spend all of it, and you are correct. My job is to one, earn your business, and two, to give you as much sign as I possibly can for the amount that you wish to invest. And there are dozens of ways that we can build you this sign. I want to come back to you with a design and a price that you are comfortable with. Therefore, what were you thinking about in terms of dollars?" They are going to answer in one of three ways or a variance thereof:
- My budget is "x"
- Whatever it takes (lying)
- I have no idea of what these cost (may be true but they still have a budget)
Now, if they answer #2 or #3, I`ve been doing this long enough that I have some idea of numbers that I can throw out and I always throw out high. "So, looking at what we have talked about here today, if I were to give you a ballpark figure of say $50,000, would that work for you?" "$50,000!? That`s way too much!". "O.K. then, what number would be more realistic?"
The point is that everybody has a budget even if they do not realize it. Through the years I have become very comfortable asking these questions and getting these answers. And, in my business, I share these budgets with my design and estimating departments and they keep these numbers in mind when they draw up the signs and estimate them. And, thankfully, they are very good at giving me something to take to the customer that looks the way they want and costs the price they expected to pay. A win-win (smile)
Craig M. Jamieson
Sales Results LLC