Ask Mike: How do I sell to someone who is “happy with their existing supplier”?

Posted by | August 07, 2014 | Ask Mike, Podcasts, Sales | No Comments

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“We love what you do, but we are happy with our existing supplier”, is a classic response to a sales effort. And it is a tough one, because it seems pretty final: not only are you up against someone else, but you are up against someone good! Do you give up? The salesman in me, of course, says no.

First, before you attempt to convince anyone of anything, you need to be sure that you can offer them an improvement. Check out their current supplier’s work, and make sure you have a credible alternative.

Never denigrate the current supplier. Just as you would never criticise a former employer in a job interview, it would only serve to alienate the very person you are trying to build a rapport with. No-one likes being labelled an idiot; and telling a client that their last choice was wrong would be doing exactly that.

Explain that you are aware of their current supplier, respect what they do and completely understand why they have chosen to use them. But you can do a better, or faster, or slicker job.

The next step is to bag a chance to show what you can do, or, as I often say, “Try me and prove me!” The key here is to give the client the comfort of an opportunity to do something with you which

  • won’t cost them much,
  • won’t require them to ditch their existing supplier
  • and won’t embarrass them even if you mess it up completely.

In other words, they should think: “Well why not?”

Similarly, this should be low-risk for you: offer to do the tiniest job you can realistically do, for a small profit, and in a defined, short period of time.

Aim to clearly show that you can solve one of the two perennial business problems – saving your client some time, or saving them some money.

Get this right, and you will have demonstrated your skill and efficiency without bashing the competition.

When you pitch this idea, you are going to have to explain why you are better than your competitor. It’s the first thing we discussed earlier, so you’ll be ready! Even if their current supplier is the MD’s brother-in-law, you need to be able to articulate your position. And even if their current supplier is the MD’s brother-in-law, a smart company will want to have some other options.

Again, never describe the current supplier as “The Opposition”. You want to work alongside them rather than replace them, maybe covering areas which they cannot. This way, you will be seen as “a nice guy/girl” rather than a predator, and, at worst, your offer is an opportunity to banish complacency in their organisation or freshen things up a bit in the supply chain.

If the client takes your offer, great. If not, ask why not. Part amicably with a promise to stay in touch.

We also ought to look at a very unsatisfactory side alley of this process: the freebie. It is perversely seductive to offer a freebie to a client when you are up against incumbent competition: it will cost you real money, yet the temptation to come away from the situation with something that looks like a deal is so strong. Most perverse of all is that you are actually offering nothing substantial: give something for free and people simply will not value it.

Instead, by all means offer a reduced deal, even offer a very reduced exclusive-super-deal, but negotiate enough for yourself to be able to turn a small profit. That way you can maintain your dignity, carry some cash flow, and take a sighting shot at the value to the client of what you do.

Another challenge is the dreaded Preferred Suppliers List – designed to repel the likes of you and I. The problem lies with the Purchasing Department who oversee this list and if you, like me, sell using charm, personality and rapport-building, you will find yourself up against a brick wall.

To get past the Purchasing Department, you need to find your internal advocate; the person who can see the benefit of you and what you do. With your advocate on side, you can find out where the bar sits and then look to go under or around it. Don’t forget, even the Preferred Supplier List was at one time empty and the names on it now represent the right relationships that were built up with the right people.

Incidentally, don’t worry about being the little guy. People often ask me: “How do I make myself look bigger”. You don’t need to. Employing lots of people and working out of a fancy office is no longer the measuring stick for a reputable company. In some situations it can actually work against you.

Small companies can be agile and flexible. They can operate at lower costs. And you can deal with any problems quickly and personally. Don’t be ashamed of being a minnow – it is an advantage.

Companies look for reliable, pleasant people and great value for money in the businesses they interact with. Their satisfaction with a current supplier does not preclude their desire to improve their business when opportunities arise. They may be happy with things currently, but they could always be happier.

Mike Southon

About Mike Southon

Mike Southon is a serially successful entrepreneur, best-selling business author, mentor and one of the world’s top business speakers on entrepreneurship, intrapreneurship and sales.

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