Biggest Sales Mistakes in Long-term engagements

Ian Altman 0:02

Ian, welcome to the same side selling podcast. I am your host. Ian Altman, what are the biggest mistakes when it comes to long term contracts? See most people in sales, what happens is when you start pursuing a long term engagement, it is natural to think, Well, gee, I'm getting such a benefit as the seller that I must have to give something up to the buyer in order to make it equitable. So where many sellers fall short is they fall back on price and they say, Oh, if you'll do a three year deal, we'll give you this discount. If you'll do a longer term gee, you wanted a four month deal, we want a nine month deal. Here are the concessions I'll give you for doing that. And there's a trap in that. And what happens is, we look at it as we're the only ones benefiting from a longer term engagement. But that's not usually the case. In fact, usually it's a mutual benefit if we have a long term agreement. If the long term agreement truly was not in the client's best interest, then why would we propose it to begin with? We wouldn't be operating with integrity if we proposed something that wasn't good for them. One of my clients deals in a service business, where oftentimes they'll engage them for a resource, and at the end of, let's say a year long engagement, they have the opportunity to hire that person in house. Well, what we know is that if the client wanted to, let's say a three month engagement, they don't tend to attract the type of talent that wants to stay in that location for a long period of time. It's people who are more transient who want short term engagements, but the people who are inclined to engage in a 12 month engagement are generally looking for something that's more stable, more permanent, and if there's a good fit, they'll often matriculate into that role where now they're there full time, and it benefits everybody. So how do we present that type of alternative to a client in a way that puts us on the same side as them? And one of the things we can do is we want to consider, how does this engagement benefit them? So let's say the client wanted a four month deal? Well, that means that after two months, you're already negotiating for the next deal. There's a lot of paperwork that we have to do, you know? Well, you know who else has to do a lot of work, the customer. They don't want to do that either. So why do customers want shorter term deals? Well, usually it comes down to they want the flexibility. They want the ability to say, look, if you're not performing, then I don't want to continue. So what if you incorporated that into your agreements? What if you said to somebody, look, we're gonna do a 12 month engagement, and in that 12 month engagement, we're going to make sure you get people who are likely to want to stay in your organization, the kind of people you can hire. We know that these longer term engagements tend to attract a different caliber of individual than when we do short term engagements, but we also recognize that you may want the flexibility in case it doesn't work out, or in case your needs change. So here's what we're going to do. We're going to have a 12 month engagement, but as part of that, you have a four month clause that says it's a rolling period every 30 days. If you wanted to, you could say, Okay, I want this to terminate four months from now. You can say that in month one if you wanted to, but the idea is that I want to have a rolling four months. See, in this one client scenario, what they discovered was that when their client engaged them for a shorter period of time, let's say less than a year, over 90% of those clients were still engaging those people a year later. So they thought they needed a short term engagement, but in most cases, in fact, the super majority of the time, they needed those people for a longer period of time. If you want to get top results for your team, take a look at the sameside selling Academy. Just visit samesideselling.com to learn more. Well, what happened during those periods when they had to renegotiate? Well, oftentimes the subcontract resource said, Oh, I've been here a while. I want to earn more, I want to raise, I want a bonus, whatever. And so what happened was the rates were going up. There was more uncertainty. There was a lot of paperwork. It was a hassle for everybody. So now the client says, Wow, this a lot of work. And why did the rate go up. Instead, the salesperson now says, Look, we're going to lock in this rate for a year. If you stay with this person, the rate doesn't change. We're going to have a rolling termination of four months. So if you want to at any point in time, you can just say, I want this to terminate four months from now. And there's no harm done. It's totally fine. Fine, but what happens is now the client has the sense that says, Okay, if we continue and things are going well, we're fine, but we're still protected if we want to end sooner. Now, as part of that, you should be doing your job, saying, How are we going to measure success together? What might prevent us from achieving those results? And now your client realizes you're more committed to the outcome than you are to the sale itself. See longer term agreements don't just benefit you as the seller, they benefit the customer as well. Only sometimes, not only we don't see it as a seller, but sometimes the client doesn't see it either. So it's our job to share that with them. So how do we do that? Well, we might say to them, look other clients, what we found is that more than 90% of the cases when people wanted a short term engagement, what they found is that a year later, they were still engaging that resource. In fact, oftentimes they needed more of them. And what they found is that in the shorter term engagements, they didn't have people who are often willing to stay in that in that location, they were more transient, so they weren't getting the people who matriculated in. And when we started doing longer term engagements, all of a sudden they would say, well, after nine months, the person said, Yeah, I want to take a full time position in this organization. And they gave them a way to do that. How different Do you think that would be for you? And now the customer goes, Oh, well, I'm sure if it worked for other people, work for us, and what that means that now we can start having discussions about longer term engagements, locking in the pricing, having less paperwork, which lowers the cost and administrative headaches for everybody and generates a better outcome. So the next time you're focused on a long term engagement, make sure that you don't think about how it benefits you. Instead, think about why is that longer term agreement beneficial to the customer, and how can you build in the comfort for the customer to avoid the things they might be concerned about, and that way you end up on the same side in these longer term engagements, there are topics you'd like me to cover. Just drop me a note to Ian at Ian altman.com always interested in your feedback and how these tips and how these episodes are benefiting you. I'll see you on the next episode of the same side selling podcast. So long you

Ian Altman 7:19

Ian. Ian.

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