In my experience, the best part of selling a project is the price negotiations. This is where it all comes together and you earn your bread, butter and hopefully some tasty extras.
Here are some tips based on my own experiences.
As a sales person it’s not just your task to land a deal.
You must genuinely want to help the customer solve his problems at a price that is good for them and good for you. This may sometimes even mean that you should refer them to someone else.
Being a genuinely trustworthy person is key in landing long term contracts.
Paint the future
For every project there’s a budget. Sometimes you’ll know about it, but more often than not your price quote will be compared with that of other companies.
What worked well for me is to sit down and rethink the customer’s request. What is his problem and what is the best, minimal solution to satisfy his needs.
While thinking up the solution I maintain 2 lists: The main solution and the “next level” functionality.
My quote will detail the main solution that satisfies the basic requirements and its price. I may even leave out customer requests that I consider to be icing on the cake. This will reduce the risk of being too expensive.
Then I add a future iterations section in which I sketch all the “next-level” additions which I think would make the solution even better.
Here I don’t add any pricing information to not make the document too bulky. Besides, odds are that the next-level stuff needs more discussion anyway.
The power of this approach is:
- Your quote is likely to not be rejected for being the most expensive one.
- You show you have thought about the solution and the interests of the customer. This will help gain their trust.
- The first version of your product will be smaller and is more likely to:
- Be delivered in time (adding to the trust)
- Work well
Smaller projects tend to be easier to deliver
- Cover the needs of the customer but leave then wanting!
What is not included
A good quote doesn’t only describe what will be delivered at what price, but also what will NOT be included in the price.
- How many design iterations are included in the price?
- Who will take care of the hosting?
- If there’s a problem with the server(s) on which the product runs, who is responsible for that?
- Who will pay for (recurring) licence fees?
- How about bug fixes?
Who takes the risk of bugs that appear after the software has been accepted by the customer?
Again, it’s very easy both for supplier and customer to only think about the execution of the project itself and not about what happens after the project is done and the product has been delivered.
But once they really start using it it’s likely the customer will need support, trainings, bug-fixes and they will want this within what they consider reasonable timeframes.
But you may not have the time, nor resources to cater to their needs at that moment.
That’s why it’s very important to agree on aftersales.
Basically a rudimentary service level agreement is needed.
Things to cover are:
- What rates / timelines apply for additional work?
- What rates / timelines apply for bug-fixes?
- Who will maintain the infrastructure on which the system runs?
- In case the customer does this but needs help, what timelines and rates apply there?