For many of us the RFP is a way of doing business…but it is not without options. In this blog we will explore keys to developing a successful sales plan in an RFP process and how to connect with the buying organization’s underlying needs.
The RFP process may be disruptive for even the most experienced seller. The key is to develop a strong sales plan that recognizes the biases and limitations of the process yet maximizes opportunities. The seller needs to recognize when to comply dutifully, object respectfully or refuse to comply.
10 Keys in Developing a Sales Plan for RFPs
Sellers should resist the temptation to view the RFP process as the full buy-sell cycle. The challenge sellers face is to plan their sales strategy early, connect with all buying influences, convey a powerful value message that differentiates the seller’s solution and keeps the communication lines open no matter how restrictive the RFP.
- Differentiate at the Executive Level. Connect with executive level decision makers before distribution of the RFP. Sellers should confirm that value messages resonate and differentiate their solution from the competition.
- Understand the Buying Process. Who will participate in the decision-making process? Who is responsible for the ultimate decision? Who will use the product or service?
- Discover Decision Criteria. Probe to understand how the buyers intend to scorecard proposals—including specific criteria and percentages. Do they have KPIs that are key to their decision? How do they calculate key measures?
- Demonstrate Capabilities. Demonstrate capabilities that surpass the scope of work but are relevant and valuable to the buying organization. What insight into the buyer’s customer can the selling organization provide?
- Probe Competitive Position. Sellers should secure feedback on their competitive position and the relative strength of their competition. Is there a preferred supplier? How well entrenched is the status quo? What would motivate change?
- Assess Risk. Seller should probe to understand all concerns that may stall or undermine the sales process. If the product doesn’t perform as claimed, who (in the buying organization) has the most risk?
- Verify Timelines & Submission Dates. Some RFPs have timelines that are “moving targets,” making it difficult to manage a selling process. Verify, document and determine how to handle them.
- Develop a Proposal Strategy. What steps must be taken to render a compelling proposal by the required submission date? What resources are required by the selling organization? Ensure the resources are available in the timeline required.
- Keep Messages Flowing. Once the seller has established an open channel to executive-level buyers, they need to keep messages flowing. Keep executives apprised of recent test results or price changes. Continue to reinforce value messages.
- Qualify the Opportunity. The temptation with a formal RFP process is to assume that the buying organization will make a good partner. The buying process will shed light on the buying organization’s culture and values. Are the buyers likely to be long-term customers? Are they driven by price alone? Are there future opportunities to sell additional products? What is the cross-sell or up-sell potential?
Build a Proposal Around What Matters to Buyers
Behind all the narratives, the forms, the legal language and technical specifications, there are buyers who harbor fears and concerns. These are very real and must be carefully addressed to ensure the deal doesn’t go astray. Consider what matters most to buyers; craft messages (in the proposal and presentation) that reassure buyers in the following five ways.
- The seller’s proposal is safe. It reduces downside risk for the buyer, ensures product availability and demonstrates product integrity.
- The seller’s proposal is affordable. The seller has taken steps to make the proposal a responsible investment with a documentable return.
- The seller’s team is prepared. The team includes the technical expertise and experience to implement, train, coach and trouble-shoot problems on site.
- The seller’s team is responsive. Current client are willing to share how the team confronts challenges.
- The seller’s company is committed. There is clear executive level support from the selling organization. The selling organization is committed to executive involvement in periodic performance reviews and contract discussions.
5 Ways to Increase Your Win-Rate with RFPs
For sellers that are committed to increasing their win-rate in responding to RFPs give thought to the following five ways to boost success
In our experience with companies across a variety of industries both domestic and international, the following five steps are keys to success.
- Know your market niche. The probability of success may decline as much as 20% when sellers stray from their market segment.
- Say “no” more than you say “yes.” A good rule of thumb is to say “no” to twice as many unsolicited RFPs as you say “yes.”
- Partner with a small company that has unique capabilities. Choose partners carefully. Some small companies may bring a vital key to strengthening your proposal.
- Assess receptivity to change amongst buyers. Throughout the sales process, continue to qualify buyers based upon their history, interest and appetite for change.
- Gain early commitment to a presentation time. Most buyers only read a few sections of the proposal. Given the time, dollars and resources required to submit a proposal, the very least the buyer can do is commit to a presentation time.
In determining one’s readiness to an RFP process, sellers should consider their own frame of mind. Are they approaching the process as a respondent or as a seller? Did they anticipate the RFP and use the time before distribution to connect with buying influences and differentiate their product/solution? Based upon their preparation (or lack of preparation) the seller should determine whether the opportunity is winnable and worth the expenditure of resources and time.
At times, we lose sight of a powerful tool that we can bring to bear on a flawed RFP process. Just tell the prospect or potential customer “No.” One of the smartest business decisions you can make is not to participate, not to serve as a “straw horse” for purposes of milking the incumbent for a low price, not to invest time and money in a process that is inherently biased.
On occasion, “no” decisions have ripple effects in the buying organization that stretch all the way to the C-suite. The C-suite has been known to ask tough questions when they discover that a powerful supplier chose not to respond because of a tainted process. It’s not without downside, but it can be a powerful reminder to the manager of the process that you have options as well.
As always, we welcome your thoughts and input. Let’s start a discussion and elevate the sales profession with a thoughtful and informative discourse.