- Your Product/Service reduces customer’s expenses without lowering performance/quality
- Your product/Service enables the customer to maximize his profits or ROI
- Your product/service reduces the business risks
The salesman goal is convince the customer the financial benefits of buying his product. To convince the customer, salesman must therefore know the financial details of the customer’s current alternative to the product/service the salesman is selling. This knowledge is of vital importance to a salesman to close the deal.
Knowledge about the customer
Getting to know the financial information about the customer is quite a task. Salesmen will have to spend considerable amount of time & energy to know about the customer.
However getting financial information about the customer is relatively easy. If the customer is a public company, then their financial information is freely available at www.sec.gov or at similar organizations (SEBI in India) in form of annual reports (SEC 10K), quarterly reports (SEC 10Q) and other financial updates (SEC 8K).
Sarbanes Oxley Act (SOX for short) has been a boon to all salesmen who are seeking financial information about their customers. SOX mandates that all the financial information disclosed to public through SEC 10K/10Q/8K must be accurate.
However, reading these reports and making sense out of these reports is a different matter. To understand the financial information in these reports one needs to have some financial accounting knowledge. It may be useful to enroll in an evening MBA class or atleast attend a few accounting classes to learn how to extract valuable information from the SEC reports.
If you have a non-US, public company as your customer, then it may be a good idea to hire a consultant or use your company’s accounts department resources to interpret the financial data of your customer. Please note that the accounting standards and practices vary across countries. Non-US firms report their financial data in a different format than the US firms. So it takes an expert in International Accounting to interpert International financial accounting information. Alternatively, subscribe to some stock analysis reports from investment bankers.
Every salesman will have a few privately held companies as customers. Getting financial information about private companies is difficult as these private firms are not mandated by law to publicly disclose their financial information. However, a few privately held companies do offer their financial data to public - either through their web sites or through market analysts. Another good way to get information about privately held firms is to through paid database services such as www.hoovers.com or www.lexus-nexus.com . In general, it is difficult to get quality information about a privately held companies.
The best way to get information about privately held companies is to ask:
- Their customers - i.e., customers of your privately held customer
- Their suppliers
- Employees/sales reps/salesmen of your customer firm
Information coming from such sources (customer’s customer/supplier/sales reps/employees etc.) must be treated cautiously - and must never be taken as a final word till it can be corroborated through a second source.
Invest time to get knowledge
Most successful salesmen will tell that they spend considerable amount of time learning about their customer. I have setup my financial news web site to grab any news about the companies whose stocks I like to invest in. Similarly, a salesman can setup his/her investment news web site (my.yahoo.com or www.etrade.com etc.) to collect any news or financial information about his existing/potential customer firms.
I also subscribe to newsletters from customer’s web site, investment broker firms etc. I also subscribe to online database providers such as www.hoovers.com & www.lexus-nexus.com to get information about privately held firms.
Knowledge is strength
Imagine that you as a salesman are in a meeting with COO of your customer - and you are doing all the talking. What is that the customer is most wanting to listen? - About themselves!! Its a well known fact that everybody likes to hear about themselves. So when you as a salesman have done your research and have gathered all that knowledge about your customer - I bet that you can have a long interesting ( to the customer ) conversation.
Having the knowledge about the customer’s financial, you can create custom offerings to help your customer and close the deal. The key advantage of having the knowledge about the customer - is that you can now customize the offering or atleast the payment terms or price that will best match the customer’s needs.
In short, the key point I am trying to communicate here is "Knowledge about the customer helps you close the deal"