As sales processes reach a conclusion, even the most experienced sales teams come up against last minute objections from prospective customers. Hurdles are inevitable, but most can be anticipated in advance and handled swiftly if you've got a few techniques up your sleeve.
We’ve compiled some of our best-in-business negotiation tactics for successfully finalising MSAs when these kinds of issues arise.
Before any significant commercial agreement is made with a new client, it is completely normal for objections to be raised – often right at the final stage of the sales cycle! Examples of real situations where late hitches come into play may include:
The client worries about the commitment at last minute and begins to hesitate.
The client attempts last minute contract negotiation tactics on price.
A new stakeholder on the client side requests something extra.
The client compares your services with those of a competitor to haggle on deal.
A procurement department takes over at a crucial stage in negotiations.
These are all objections that salespeople encounter all the time and as you gain experience in contract negotiation tactics, you will be well prepared to respond positively.
You can calmly deal with these types of objections professionally and effectively by using proven sales negotiation skills to handle last-minute obstacles. Here are some effective responses and solutions to typical client objections gathered from experienced salespeople:
A rushed response to lower a price is unlikely to be the wisest move here. Rather than simply lowering the fee you will need to assist the client in perceiving adequate value. Does your product cost more because it is the best in the marketplace?
Talk through this price concern and prove to your prospect that the value of your product means they are investing, not buying. The goal here is for the price to remain as stated in the MSA, though some room for final price negotiation should be always be factored in.
This is one of the most common contract negotiation tactics. Rather than getting into a haggling situation here, treat the objection with curiosity. Can you get a full picture of what your competitor is offering and beat that deal without harming your bottom line? You may want to take the concern to a respective department to help you further demonstrate value.
Another solution here may be the inclusion of a clause in the MSA allowing the prospect to test the product for a short period before payment. Ask the client, “Would you feel more comfortable with us if you could try the product for yourself first?” This allows them to immediately feel the benefits of your solution, rather than entering protracted negotiations comparing you with competitors.
A new stakeholder, in this case a decision maker you do not know, has entered the negotiation. The familiar tactic of adding another decision maker to the process should not be an unexpected turn of events.
The best prevention is to work hard at qualifying good quality leads early in the sales cycle. This way you can make sure that you talk to a person with the authority to decide from the beginning and not to someone on a lower level. Research shows that companies with strong pre-sales capabilities ‘consistently achieve win rates of 40–50% in new business and 80–90% in renewal business’.
You worked with your prospect for months and are now dealing with a procurement agent who is pushing for changes on the MSA before signing. Forming the closest possible relationship with the decision makers and having a good understanding of how procurement works will put you in a strong position.
Likewise, leaving yourself some room for manoeuvre on price or deliverables early in the sales cycle will give you more ammunition to handle procurement. Having a tool like a CRM (Customer Relationship Management) system can help you keep track of previous proposals and changes to the MSA, ensuring you have a reliable history of the negotiation process.
This may be the perfect chance to take advantage of the law of reciprocity - a key element in the psychology of selling. Reciprocity refers to going that extra mile for someone, without asking for anything in return.
Your response to this objection might be, ‘I could come and show the product to your directors so you don’t have to spend time trying to convince them’. You are not forcing your client to sign the deal in exchange for extra information, but you are making it much easier for them - or their boss - to sign the MSA.
Rarely will you find yourself in a situation this late in the sales cycle that can’t be resolved.
It’s in both of your interests to complete the deal, so being proactive and prepared when it comes to issues like these should work in your favor. Remember—build the relationship early, utilise communication tools in your arsenal, leave yourself some give when it comes to pricing, and know exactly what your prospective client needs and how your product meets or exceeds those needs.
And if all else fails, check out some of our other tools and resources to help you out along the way.