In part 1 and 2 we looked at generating leads and converting interest into purchase decisions. Now it's time to seal the deal. Closing and delivery round out the four stages of the sales led business cycle.
Closing - Negotiating the Details and Signing the Deal
Closing is all about negotiating the details and agreeing to delivery and payment details. This happens after the customer has seen the value and made a decision that they want to buy. Closing includes things like choosing the color, options and accessories, negotiating warranty, agreeing on the final purchase price and discussing delivery options. As you read this you are probably starting to see that it can be very advantageous for a company to delay discussion of these points until after the buying decision is made.
Right up to the point that we, as people, make a mental decision to purchase something any little problem can make us change our minds. Consider the last time you bought a car. Did you pay a little more than you were planning to initially? I know I did. My first brand new car was a Jeep. I wanted something under $20,000 and they were advertised as starting from $17,500. So I went for a look. I drove a few different ones over the course of several weeks. I talked to the sales people and changed my mind a few times because I saw a scratch, or didn’t like the color. Then one day I was feeling good and went to drive another one. This one had some extra options and looked especially good. Some young women at the lot commented on how much they liked the Jeep I was driving and I decided I was going to get one. I made a mental decision to buy it. I started to imagine taking it home. I imagined driving it around, and all the complements I would continue to get from young women like the ones at the car lot. I told the salesman who was helping me that I wanted to get one and he switched from converting to closing as we went inside to discuss the details. The $17,500 model was not available. They had one for $19,000 but it didn’t have the chrome wheels or the back seat, or the same stereo... The convertible top was extra, the back seat was extra. To make a long story short I walked out of the dealership with a $24,000 jeep and several optional extras. I would not have even looked at a $24,000 jeep at the start, but after I had made the decision to buy it the emotions took over and it was relatively easy to get me to agree to the new costs. I loved that Jeep. I never regretted the decision to buy it, or the decision to spend a little more and get the options I wanted.
Closing is when both parties have committed to making it happen, and both are very motivated to sign the deal. Once I said I wanted to buy the Jeep, not only was I committed, but so was the sales person. He knew that if I walked away at this point it would be because of him, not because I had any remaining indecision. He had already started to imagine the commission cheque in his pocket and the things he would do with it. We both had a vested interest. We were both committed to coming to a suitable arrangement. We both had to give the other what he wanted to get what we wanted.
Closing provides a powerful opportunity to add value to any sale to both the customer and the seller. It is important to recognize it as a separate stage in the sales process.
Delivery
Delivery can be both the final stage and the first stage from a sales perspective. On the one hand, once the initial sale is made the hard part is over and you just need to tell the factory, or warehouse or service provider to go deliver the solution as agreed on. On the other hand, prompt professional delivery of the solution can result in a very satisfied customer who will be ready to buy from you again the next time they need a similar solution. A good delivery experience can get you a long way towards the next decision to buy. Conversely a bad delivery experience can result in product returns and a virtual guarantee that you will never get another sale from that customer.
Effective sales led organizations pay special attention to the delivery stage. It is easy to think that the sale is over as soon as the contract is signed, but the best sales led organizations realize that this is merely where the next sale begins and make sure every opportunity is taken to satisfy the customer and make the next sale easier.
The business cycle from the a sales perspective is three quarters about selling (leads, conversion, closing) and one quarter about the rest of the business (delivery). This perspective of business expands the portion of the business that sales people have direct impact on, and minimizes the visibility of activities they have little or no influence over. The sales perspective of business is very useful for training sales people on the major things they need to be doing to help the business and the customer. The sales perspective is also very useful in training the rest of the business how important it is to support their sales team. Without sales, there is no business.
Got a Question? Ask.
Ask the community a question about this article:
Frequently Asked Questions
Any information on how to start auto recycling ...
By: bestcrown | 20-07-2008
Any information on how to start auto recycling business ?
Would there be any harm to a private business ...
By: drabsv | 03-07-2008
Would there be any harm to a private business enterprise if they keep their whole (monthly) budget open to the public?
What is SmartGreenUSA?
By: clm168 | 24-06-2008
What is SmartGreenUSA?
Family Business as a Job
By: MarilynBB | 21-06-2008
Would you like to work in a business run by one of your family members? Why or why not?
I assume that there are two types of organisations ...
By: drabsv | 18-06-2008
I assume that there are two types of organisations according to the relation structure-people:(1) organisations which expect employees to adapt to their rules, roles and conditions of work. If there are not enough candidates, these organisations react by either increasing salaries or by coercing people to work there through various mechansims - manipulating unemployment rate (e.g. outsourcing work to overpopulated Asia, letting immigrants in); mandatory labour service/ military service; etc. In brief: "the individual must fit into the system". An example of a policy of such organisation: "working time is set Monday till Friday, from 8 am till 5 p.m".(2) organisations which create their rules, roles and work habitats with the human in mind, from the very outset; they also maintain feedback loops to change (improve) those rules, roles and conditions for work when necessary. In brief: "the individual must fit to the system and system must fit to the individual".An example of a policy of such organisation: "the working day is 8 hours; standard working time is set Monday till Friday, from 8 am till 5 p.m but you can arrange with our managers a different schedule, convenient to you". If my assumption is correct, any examples of type (2) organisations?
Who would like to develop a trust business relationship and benefit from the great links I have for sale?
By: shmitche | 27-05-2008
I need trust based business relationship because... This is what I have to offer: 1)Permanent one way links. 2)In a network of 1000's of untapped websites: PR2 ? PR5 only (Class ? C). 3)Unique handwritten content only in this network and every post. 4)You can target and rank for any text link keyword you choose. 5)You can direct your link to any page you choose in your website. 6)Completely untraceable. 7)Only 5 dollars a link. 8)Content and links are distributed naturally (chosen from options by buyer through me) for SEO. Restrictions: 1)No porn, gambling, or black hat websites or cheap websites. I will have to authorize the site. 2)Security is tight there are no reports (I don?t have access for my own sites) only yahoo link search and a jump in rankings and traffic will be evident. 3)I only want to sell once a month to one client. 4)I will only sell $500 - $600. per month 5)Payment must be upfront (A must for system to work) 6)Will not reveal my source. Contact me for any questions.
Q&A Powered by:
Latest Management Articles
Process Improvement Teams For Six Sigma Success
By: Tony Jacowski | 24/07/2008
Very often, the managers of the company devote their time to fighting fires and find little time to carry out daily responsibilities or improvement initiatives. The Six Sigma approach uses cross-functional dedicated teams to initiate improvements in the existing organizational processes.
Guidelines For Six Sigma Healthcare Project Selection
By: Tony Jacowski | 24/07/2008
Six Sigma can be an effective approach to the improvement of services by any health care organization. Its utility can be advantageous to the betterment of services like those of the administration department, housekeeping, emergency and operating processes and so on.
7 Reasons Why Six Sigma Benchmarking Efforts Fail
By: Tony Jacowski | 24/07/2008
Benchmarking is comparing the results of other organizations for the superior processes and results achieved by them with that of your organization. It is comparing your own processes with the best practices of the top-level companies. It is not mere goal setting, but evaluating the approach of these companies to achieve the sustained results.
Imagination.io
By: ryan | 24/07/2008
With the right guidance, an Internet business can start generating income almost immediately. A home internet business can be very successful for people who have the dedication, skills and patience to await agradual increase in business and income. There are several ways how an internet business can be started. However, no matter which internet business is being initiated, it won't make an impact at first.
Commercial Landlords May Offer 1 Month Agreements
By: Gary Howes | 24/07/2008
Commercial landlords have backed a campaign by the British Retail Consortium to offer retailers a helping hand during the economic downturn.
Unknown Facts About Leadership Revealed
By: Steven Sonsino | 24/07/2008
Do charismatic CEOs have any effect on business performance?
Two Questions to Help You Change Your Leadership Style
By: Steven Sonsino | 24/07/2008
There are ways you can overcome resistance to changing your leadership style.
Grow Your Physical Therapy Business With Focus and Clarity
By: Erika Trimble | 24/07/2008
In collaboration with PABC, I recently interviewed clinic owners to determine their biggest challenges in growing their private practice. During these interviews, I learned that the four key challenges are: recruiting physical therapytherapists, time to dedicate to business growth, lack of business, and marketing skills. In this article, I’ll help you tackle one of these challenges.
More from Daryl Cowie
How to Use Contractors as Insurance for Staffing Risk Management
By: Daryl Cowie | 19/05/2008 | Management
Have you ever sat next to a contractor who you knew was making a better hourly rate than you for doing the same job? They have no long term commitment to the company, often less experience than you, and still you know they are being paid a premium for being there. It makes you wonder what the financial genius who hired them was thinking when they approved that plan doesn't it?
3 Alternatives to Hiring Full Time Staff
By: Daryl Cowie | 19/05/2008 | Management
How do you quickly turn up and down the amount of labor you pay for when your employees are relying on you for their livelihood? Here are some practical management tips for building a flexible, variable sized workforce...
How Top Managers Use Indirect Cost Control Strategies
By: Daryl Cowie | 25/04/2008 | Management
When you set out looking for ways to cut the cost of providing your products and services, take the time to look past the parts and pieces of what you provide to the equipment and resources used to create them. These components all contribute indirectly to your per piece costs, and represent opportunities to save money on the things you do repeatedly.
Shipping Cost Savings Goldmine Management Tips
By: Daryl Cowie | 25/04/2008 | Management
Packaging, shipping and handling costs represent a large portion of variable business costs and are often overlooked by inexperienced planners. As a result in many businesses this presents a fabulous opportunity to make changes that will have an immediate and noticeable effect.
Tackling the Cash Flow Problem - Part 3 of 3
By: Daryl Cowie | 08/04/2008 | Management
Let's look at the 4 big management tips to keep your cash flow situation running smoothly...
Tackling the Cash Flow Problem - Part 2 of 3
By: Daryl Cowie | 08/04/2008 | Management
Suppose now that our business gets an order for $100,000, ten times our usual monthly amount. This is a great problem to have, but it can also be very dangerous for a company if they don't manage it right.
Tackling the Cash Flow Problem - Part 1 of 3
By: Daryl Cowie | 08/04/2008 | Management
The biggest challenge in controlling variable costs is that you often need to make the decision to spend before the actual sale is made, and you often need to pay your bills before you can collect payment. To top it all off, if you guess wrong on your planned income you still need to pay your vendors and your staff.
Seeing the Total Cost Picture - Part 2 of 2
By: Daryl Cowie | 07/04/2008 | Management
For new managers and middle managers one of the best management tips you will ever learn is to start with the variable costs. Variable costs are everywhere, they are often the biggest business expense, and it is possible for managers at every level to influence spending in this area.
Business 
