The Closing Tactics that You May be Competing Against.

DISCLAIMER.

Where I have mentioned ‘couple’ I do not imply that all couples consist of one man and one woman nor whether they are married or not. In the context of this book, ‘couple’ means two people who are buying a product together.

I have written ‘salesperson’ as a description suitable for male and female but where it is necessary to write ‘he’ or ‘she’, I have chosen to write ‘he’ rather than the clumsy use of both.

Your Product Does Not Speak For Itself.

Too often small businesses miss out on orders because they don’t like to close. They don’t want to be too salesy or too pushy. Quite often, they think that their product and knowledge will speak for themselves. That would be true if your competitors operated in the same way, but they don’t. They use sales tactics, most often to generate FOMO – the Fear of Missing Out.  Still, in this day age, with all the media attention, they don’t realise that there is no such thing as ‘a deal that it is only available on the day’.

There are some closing tactics that really should be used – they’re not tricks. They make business sense.  You are not in business just to give out quotes for comparison. I don’t teach pushy tactics but if you argue with me on that point, I would have to tell you that you’re being naïve. 

The Vital Admission.

I am a fan of the ‘vital admission’. I don’t think you should ever give a price before selling the value. I know that a lot of salespeople/business owners just measure up and leave a quote. Yes, you will sign some orders like that, but your conversion rate will be low and you’ll be missing opportunities.

I was first taught the ‘vital admission’ at Everest. For sure, you had to sell the value before giving the price, for that company.

How does the ‘vital admission’ work?

The first point is to make sure the design/proposal is complete, and the product is definitely what the customer wants. At this stage, they may not have decided to buy from the person who has produced the design. All they know is that they are happy with the design and specification. They may get quotes elsewhere.

When all else is done, the salesperson will deliver the final design and summarise everything that is included. He will then ask for ‘the vital admission.’ This is where the customer confirms that the product is the one that he wants to buy. Without this admission, there is no point in quoting a price. No one buys a product that is not wanted, regardless of price. If the salesperson proceeds without this, it is likely that when the price is delivered, the customer will say that they have not completely decided on the design. The salesperson can go back to the design and start the cycle again, but he will have wasted time and lost momentum.

This is how it goes:

‘Putting price aside for now; 

‘You’re happy with XYZ company name?’…(‘Yes.’)

‘Hopefully, you’re happy with me?’…(‘Yes’)

‘Is that the kitchen/bedroom/conservatory/blinds that you would like to invest in for your home?’ (‘Yes’.)

‘So, all we have to do then is make it affordable for you?’

If the customer says yes at this point, they have agreed to buy if the price is right.

If the customer hesitates at the third question or says no, the salesperson will go back to the design and make any changes until they agree that it is the product that they want to invest in for your home.

If they say no, it would be pointless for the salesperson to give a price. Why would they want a price for something that they do not intend to buy? Do you see the importance of this? Note the use of the word ‘invest’ which is more powerful and suggests more value than the word ‘buy’.

You can use this in a gentler way. 

‘Before I tell you the price, I want to make sure that I’ve understood everything that you’ve told me and if I haven’t, tell me because I really want to do a good job for you’.  

Summarise all of the points that you’ve talked about and confirm that you have completely understood their requirements.

There are several ways of closing the deal and the experienced salesperson will know them all and use whatever is most appropriate depending on the customer and what has already been said. If the salesperson is confident that the customer is ready, he can keep it simple and say:

‘Would you like to go ahead with that?’

‘Shall I do the paperwork?’

‘Let’s get this done then shall we, and you can get back in time for the football?’

If the salesperson is not 100% sure of a positive response, he may prefer to use a different close to test the customer or play on psychological weaknesses that he has uncovered during the meeting. 

Ego Close.

This one is used by the more expensive companies. People do not like to admit that they cannot afford something. This close will only be used if the salesperson has seen that the customer pays for quality or buys expensive brands.

‘If you can’t afford this, I understand. Not everyone is a suitable customer for us, but I can see from your home that you appreciate quality so would you mind telling me what is holding up your decision?’

Elimination Close.

This is best used when there are one or two issues to be resolved. The salesperson will make a long list, itemising everything that is included in the price. He will then write down the objection/s on the right of the page which will look small in comparison. The exercise would not work too early in the appointment when there are too many outstanding issues. He will then summarise and ‘say:

‘So, it’s just these two things we need to sort out. If I can arrange those for you, are you willing to go ahead today?’

Sometimes the first attempt is a ‘trial close.’ He needs to find out what the objections are, as often, those objections are not revealed until the customer is forced to decide if he will buy or not.

The customer will either:

• •Say yes.
• •Ask a question.
• •Give a reason for why not.

If the customer agrees to go ahead, there is no more to do other than sign the order. If a question is asked, the salesperson needs to make it work for him and you may find that he answers the question with a question.

‘Is that your only concern? If I can solve that for you, are you happy to go ahead today?’

If he just answers the question, he may attempt to close again and find there is another question. This response will establish if there are other questions and whether it is the real reason for not going ahead.

Direct question close.

If the salesperson has tried several closes and senses that he is not hearing the truth and the customer is not warming up, he may try the direct question.

‘I think you are happy with the design and the price so let me ask you straight up. I would love to be involved with your project. What do I need to do for you to go ahead today?’

It is rare that a direct question does not receive a direct answer and there’s nothing wrong with this. If they are not going ahead with you, they are far more likely to be honest with you about why, if you are straight with them.

MOST COMMON OBJECTIONS.

In the home improvement industry, the two most common negative responses to a close are:

1. We want to think about it.

Salespeople know that the ‘we want to think about it’ objection means that they have not been sufficiently convinced. If the customer has confirmed that the design was what they wanted, the real reason is usually that the price that they are willing to pay has not been reached.

‘I understand. It’s a big decision. Can I ask you what it is that you need to think about? I believe that I have designed the _______ that you’re happy with. Is it the price?

2. We’d like another quote.

The salesperson will want to deter the customer from meeting with other suppliers. As far as he is concerned, the only reason to do that is that is if they are not happy with the price, especially if they have confirmed that they’re happy with the design.

He may ask who they plan to invite to quote so that he can undermine them before saying the following:

‘I understand, it’s a big decision. I’m just a bit concerned because if you come back to me next week, the price will be higher. You have a legal right to cancel within 14 days without question. In the meantime, you can carry on gathering quotes and if you find like for like we will price match. At least that way, we lock in this price if you don’t find it cheaper. Your deposit will be refunded if you decide not to proceed. Does that sound good to you?’

This is the point at which customers are not inclined to be honest. If they are happy with the details, the objection is usually about the price, but they do not know how to ask for it. If the salesperson has assured them that he has given the lowest price, they may not realise that more discount is available. The easiest way forward for them is to go to another company to see if they can buy the same specification for less money.

It is up to the salesperson to keep the negotiation going. From this point, the salesperson will add any of the discounts from the list shown earlier until he reaches a price that the customer will pay. There are no fixed amounts for those discounts, as they do not exist. The salesperson will apply a figure or percentage depending on what he is trying to achieve. 

He can also reduce the price by changing or removing features depending on what the product is. Some salespeople design to the highest standard because it is easier to remove features than add them. Others design to the lowest cost because they fear delivering the price, but the price goes up as the design is added to.

If the salesperson is clever, even after he has exhausted his discounts, he will have left a bit of money to play with. If he has nothing left to negotiate with and the customer is still saying no, he has no choice but to concede and leave the house. It is always preferable to sign an order than not, even if he earns no money out of it as it may count towards bonuses.

Quote for the Full Price.

Customers often ask for a written quote even though they have no intention of buying. They don’t like you to feel as if they have wasted your time so they try to give you a little hope.

He leaves a quote for the original price without the negotiated discounts. If he does not have a quotation facility, the price may be scribbled on a card or brochure. He hands it to the customer so that the price can be seen. 

They are obviously horrified to see the higher price even though they had no intention of buying! That’s how powerful buying psychology is.

‘Is this correct, you said the price was £7,350 but this says £8,756?’

This is what he expects the customer to say. If they said nothing, he would know that there was no chance of a sale at any price.

‘Yes, it is correct. I am controlled by my computer and when I upload this as a ‘no sale’ tonight, it will remove the possibility of the discounts.’

‘Don’t forget that you have 14 days to continue your research and cancel if necessary. Let me put these samples away in the car and give you a few minutes to talk about it.’

Deals are often agreed upon at this stage. 

The Scrappage Scheme and Other Myths.

The following is a description of the methods used to drop the price. This process of negotiation can take between one and two hours on top of the two hours spent on design and measuring. 

Salespeople who start at a high price even after the 50% discount has been applied must drop the price and still appear credible. This is not easy to do because it is not credible. Learning the craft of negotiation is the single biggest difference in success or failure for the salesperson. Do customers honestly believe them when they’re told it is half price at £15,000 then still drop another £5,000? With hindsight, probably not, but when they are caught up in the moment, their brain chemistry is making them excited and they want to buy the product. They believe anything, if it is made affordable for them, and feel they are given a good deal. Some customers are aware that it is all hype. Others become upset at these tactics and can turn nasty if they feel they are being conned. The salesperson needs to be careful to appear genuine. 

All salespeople know how much they can discount, over and above what the computer produces. The salesperson may be able to see the total discount available on his computer so that he can be aware of the effect on his earnings. Watch them. You will see it if you watch closely, they’ll press ‘CTRL’ and ‘A’, ‘X’ or ‘C’. A box will pop up on the screen but disappear when the keys are released. This gives the parameters of pricing including the highest and lowest. Others may scroll to the top where the extra profit is written in code. If you’re in kitchens go into the big supplier that’s destroying the industry (mentioning no names). You may see something like YHT234535.4. The 4 on the end indicates there are four decimal places which mean that the available discount is £2,345. A number ending with 3 would indicate three decimal places making the extra profit £234. Others with less sophisticated software will be aware of how much percentage they can drop the price. They may also have a limit on the amount that they can apply themselves but must phone the manager for further discount.

These discounts exist and are available. What does not exist is the reasons for them. Depending on what has been decided as a starting price, the customer may be told that certain discounts have already been applied to show goodwill and to gain trust. Others are used after the salesperson has assured them that the best possible price has been given and they still have not agreed to go ahead. 

Board outside.

Most workmen will put a board up while they are working on customer’s premises. It is a good source of advertising. Most customers do not mind this at all, but it is still another ploy. They will hear something like this:

‘I can give you a discount if you are happy for us to display our board outside the house while we are working. Would you be happy with that?’

Everybody says yes to this. They are going to have a great big van with their name emblazoned on it outside their house, why would they object to a tiny sign? When they say yes to this, the salesperson has heard another buying signal. If they say yes to a board, as far as he is concerned, they have indicated that they are going to buy.

Can you see how subtle this is? There is no pressure. It is still a friendly chat and he appears that he is acting in the customer’s best interests. Customers believe this to the point that they worry that there will not be a slot for the show home discount and ask for it to be checked. The salesperson will make a phone call. There is always a manager on duty to take these calls, no matter how late in the evening. This is what they may hear:

Hello John, I’m with Mr and Mrs Prospect. and I want to use a show home discount but when I checked yesterday there were only two slots left. Can you have a look for me? 

(Waits a moment while the manager waffles on or tells a joke.)

‘You’re joking, that was quick.’ Well look, the Jacksons are not being installed for a while, can you give me their code and I’ll put one in for them in the next period.’

Another pause.

‘No, that’s not my problem. I’m not giving up my code for someone else. I’m using it for my customers, or I’ll keep it allocated for the Jacksons.’

Puts the phone down and turns to the customer to explain.

‘He says there’s someone else waiting for a code, but I’ve reserved it for you. So, I can confirm the price of £???? Shall I do the paperwork?’

It is rare that a customer does not sign up having gone through this process.

Photos of installations are rarely used in marketing as without the use of special lighting, it is difficult to take good quality photographs. This discount does not exist.

End of run.

There is no such thing as an end of the run. End of what run? The run never ends. This is used to apply to the manufacture of shutters or window frames. It is almost ridiculous but used because the customer does not know about the manufacture of the product, so it can sound feasible. It works like this: A phone call to the manager is made. 

‘Hi Ben, I’m with Mr. & Mrs Prospect in Swindon and I’m a little bit off the price they want to pay. It’s only a 12-metre run, do you think I could have extra discount for them if we can squeeze it on to the end of the October run. I think it closed yesterday. Can you check for me?’

The manager will call back 5 minutes later. During this time, the customer has become anxious because the fear of loss is kicking in. Luckily the sales manager delivers the fantastic news that they have managed to squeeze them in if they can decide tonight!

Flexible installation date.

While it is true that installations are delayed, and dates are juggled to try to keep the installers in work, this is rare. There is a standard delivery time and the installation date is arranged for a few days after so flexibility in the schedule is not feasible. It is another label to put on a discount to sound credible after saying that all the discounts have been applied.

‘As you’ve already said that you are not concerned about delivery dates, if I can put you down as flexible, I could give you another £350 off. It means that your installation could be up to one week early or late. Is that ok with you?’

Supply and demand discounts.

The level of business that a home improvement company does is not consistent throughout the year.  The busiest times are January, March and October – November. The quietest times are December and the summer holiday period. However, the company must keep their staff and contractors consistently at work, so will try to spread the load by offering discounts to fill in the gaps. For example, December is busy because of the rush to install before Christmas. Those customers who are not concerned about Pre-Christmas installation may be offered an extra discount to delay installation until January which is a quiet time for installation.

During busy times, discounts will be lower as they struggle to keep up with demand. It naturally follows that they will be higher at quiet times. Often these discounts are announced to the sales team with an incentive, offering an additional bonus or commission.

Carbon foot-print. 

If the salesperson senses that the customer is on the verge of a decision and needs a little nudge, then he will bring in the ‘carbon footprint’ discount. He cannot mention this too early as to do so would show that he expects to sign on the day and put the customer on the defensive. It is usually the last discount unless he is forced to go to the last resort and use the ‘error account’.

‘Look I’ll tell you what. I didn’t mention it earlier because I know you don’t want to go ahead today, and that’s fine. I just wanted to let you know that the lady that I saw this morning also didn’t want to make a decision today, but because she wanted to buy at the best price, I was able to give her the carbon footprint discount. £250 (or however much he needs) is worth saving, isn’t it?

 If we had to visit everybody twice, we would only see half the number of customers, double our fuel bill and employ twice the number of agents, which would make our sales meeting double the size. You can imagine how much extra this would cost the company. Does that help get to the price that you wanted to pay, bearing in mind that you have nothing to lose by securing the price, and if you do feel it’s not right for you, you have 14 days to cancel?’

If the customer hesitates, he will point out that he has no control over that one as it is removed from his computer when he reports a ‘no sale’ later. Again, he is stoking that fear of loss.

A genuine carbon footprint discount does not exist. It is another way of reducing the price while appearing credible when he has already said he has done all he can.

Just When You Think it’s All Over.

I don’t mind this one. You can use it in a legitimate way to find out if your customer is serious or not comfortable about telling you the price is too high.

The salesperson has given the best price he can while still retaining enough to earn decent money. At this point, he will appear to have accepted that there is no sale and is packing up to go. The pressure is off, and the customer relaxes thinking he is finally going to leave.

It goes like this:

‘Mr. & Mrs Prospect, I appreciate your time and I’m sorry we couldn’t help you on this occasion. Can I ask you, because my manager will ask me, was there anything I could have done tonight that would have changed your mind?’

The customer is pleased at this point thinking that there has been no pressure and they are let off the hook.

‘No, we like to take our time and get a couple of quotes before we make a decision.’

‘That’s great thank you. So, you wouldn’t have signed even if it was half price?’

‘Well if it was half price… (brain signals start firing at the prospect).

‘Now you know I can’t do it at half price, I’ve given you all the discounts I can reasonably give. But you have just indicated to me that if the price was right you would be willing to go ahead. What would you reasonably be prepared to pay?’

The customer has let him back in, just when he thought it was over.  The customer will make an offer, depending on how far off the price, the salesman was. If the offer is within the price range, the salesperson will accept it and sign the deal. If it is way off, he may negotiate somewhere in between, but bearing in mind that he has said that he has given all the discounts that he reasonably can, he needs to make it credible, so he may then phone the manager or use the ‘adjustment account.’

If the customer replied, ‘no, not even at half price,’ there was never a chance of a sale in the first place.

Adjustment account.

This is also known as the error account, supplement account or anything else that the salesperson can come up with. It is used as the last possible resort.

‘There is one more thing I can do. It’s a bit risky for me so I don’t usually do it until the end of the month. We have what is called the error account. The process used in quoting for your conservatory/kitchen/blinds is complex and it is easy to make a minor mistake. If, for instance, I forgot to order a décor panel (or missed a drain), I would be able to use the error account to give it to you free of charge without it affecting my commission. If we don’t use the error account, we get a bonus at the end of the month, but I prefer to use it for a customer that can’t quite meet our price. You can appreciate I can only use it once but with that in mind, I can get closer to your price. Will you meet me halfway at £7,500?’ 

If necessary, if the offer is feasible, he will give in and meet the price. Having negotiated the price that the customer wanted, they are hardly likely to say no.

Note from the Author – Sian Wood

The main reason that I have had such success in home improvement sales is that I do more than anyone else. I have a complete process that I follow to make sure I fully understand their needs and can present the right solution. Part of that is having exceptional product knowledge and being able to see the finished product installed in my mind. 

When I have finished my process, there are no questions left in my customer’s mind and no reason not to make a decision. 

My best advice to you is to establish a process and make it a priority to complete the call giving your customer 100% attention. If you are a business owner, you have a lot on your mind and a tendency to think more about how quickly you can get out.