I was reading an article recently about how to combat a prospect’s claim that they have a contract with your competition. This article gave readers tips such as mentioning that the longer the contract they have in place, the more money you can save them.  Personally, and professionally, I have several issues with this, and think that taking such an approach will end up hurting you more than it helps.

Here are some of the reasons why:

(1) YOU make a promise, but can you keep it? I understand that salespeople don’t like to hear the word “no”. I get that we all want to make the sale. But, I don’t think making a promise to a prospect that you will do something better than the person currently doing it is wise when you don’t know anything about the prospect’s situation. When you do this, you back yourself into a corner, setting yourself up for one of two possible reactions from your prospect:

(a) Your prospect will think that you are full of it and be less likely to talk to you

(b) Your prospect will ask you how you plan to do things better, which may even be worse than possibility “a”

(2) YOU made this about money. I have said it hundreds of times, “Money is generally only an issue if you don’t have any way to differentiate yourself.” Think about it, what do you buy that is based on price and price alone? 99% of the people I ask this to answer the same thing—“gasoline.” When asked why, the reason generally is because they do not see the difference between the Shell station on one corner and the Mobil station down the block, so they go to the one that is a penny cheaper. Even in this scenario, many will pass the “mom and pop” independent station that is two cents cheaper because they think the gas the independent received is “from the bottom of the truck and filled with sediment.”

That aside, why would you want to start off a conversation by saying that you are going to be cheaper than the other guy? You are entering the conversation by downplaying anything else you can do for them or anything else about your product that is unique or valuable to them. You are telling them that you are just like them, but cheaper.

(3) YOU disrespected their contract. So you will get me out of this contract? Why not, it is just a piece of paper open for negotiation, right? Great…I guess that means the one I have with you will hold as little value too.

Wait a second, that didn’t exactly go the way you wanted to, did it?

By disrespecting their contract, you set a precedent that yours can be disrespected too. What you are really saying to this prospect is “I will do my best to save you a buck, but if someone comes by and beats my price by a nickel, you are free to go with them.” These are generally the same people who say that loyalty does not exist in business anymore.

I don’t negotiate contracts. Either we can do it or we can’t. But everyone is leaving happy and everyone is going to feel that it is fair or we simply will not do it. I also don’t disrespect contracts already in place. If a client is not happy with the service he/she is getting from a current supplier and has decided that they would prefer to work with us, we will help them to do so within the means of their current contract; sometime there may even be a respectful “out” in an existing contract if the incumbent is not doing their job properly. But that said, if there’s not,  I’d rather wait a few months to close the right project at the right time and sleep at night doing so than enter (as my friend Will Webb from Dupree & Webb Insurance would say)  a “love ‘em and leave ‘em” relationship!

(4) YOU ignored developing a relationship. The fun in developing a long term relationship is just that: developing a long term relationship. It is understanding the needs of your prospect, and the potholes along the way that will make things run more smoothly in the long run. Have you ever heard someone say, “This seems too good to be true,” and then have it not be? Not often. Usually if you look for that quick, short term, transactional “deal” rather than the long term relationship, you might earn a quick commission check, but set up the relationship for failure.

Let’s face it, unless you went into the conversation knowing the contractual terms they were currently working with (and if you did, why did you call on them at this time?), it is quite possible that the person telling you they just signed a long term contract is really saying “I have no idea who you are. All I know is that you want to sell me something.” By having this person say to you “I have no interest in buying what you have right now” they have taken the pressure off you to close the deal. If handled properly, they have also given you the chance to develop a stronger relationship over time so you don’t end up looking like Will’s competition.

So the next time a prospect throws an obstacle in your way, I challenge you to look at it as an opportunity to grow a relationship, a stepping stone to a stronger opportunity, not a nuisance to get past.