We expect the feedback to come rolling in about this blog topic. We know what you’re thinking. You’ve spent whole quarters with procurement hammering out costs. You have a hard time believing that price isn’t their one and only focus.
But really, just hear us out. Procurement has to care about more than just price if they want to be effective. It’s your job to find out what else is driving their deal strategy.
If fact, we posed a question to close to 200-thousand people who belong to the Procurement Professionals LinkedIn Group. We asked them, “What’s the one thing you want sellers to know about procurement?”
The first response came from a Chief Procurement Officer with more than 20-years of experience. He said, “…that we DO understand value, as well as price. So please give us more of it.”
That’s music to our ears. That’s the cornerstone to negotiating on value.
In our Command of the Message® methodology, we teach that in order to sell value and solutions over product features, you have to uncover the positive business outcomes your customer is trying to achieve. We believe the same is true with negotiating, even with procurement. You have to uncover the driving interests behind procurement’s requirements for accepting the deal.
One of the ways to discover these “other interests,” is to remember that procurement has to please many people in their own organization. They often have conflicting metrics that they need to reconcile in deals. For example, procurement may need to lessen long-term contracts, but the organization as a whole may be trying to stabilize sources of supply, while growing the business.
When you’re able to expose these metric conflicts, you’ve uncovered possible pain points you can use to position your solution for procurement. Because they need to solve the problem they’re facing, they’ll be more than willing to listen to your solutions.
The last thing procurement managers want to do is disappoint the people in their own company. That means it’s your job to help them satisfy these needs of their internal customers. This also means not allowing them to make a bad purchase decision, on behalf of their company.
When you approach negotiation as a strategic process based on value, you see that procurement needs to care about more than price if they want to be effective in their position. Positioning value will help them resolve these conflicting metrics and please the groups in their own organization.
