Selling B2B


Business-to-business selling


Business-to-business selling is when you or a representative of your business approaches another business with the purpose of providing a service or product in return for money.

This usually means managing prospects within a defined sector containing a limited number of prospects.

business to business selling

Personal selling to other businesses offers additional elements to be managed compared to a consumer single meet sale.

The biggest difference is the concept of proactive buying.

The professional buyer undertakes a proactive and repeating buying process that evolves experience in technical or product knowledge, procedures and interaction with prospective sellers.

This proactive experience curve can work both for and against you.


Understanding proactive buying

Below are some of the concepts you have to consider when developing a business-to-business sales strategy.


1. You have to get it right first time

Business-to-business selling into more generic sectors can have more in common with consumer selling in that there is always another prospect to talk to. An example would be a mobile network provider where there are thousands of businesses to market and sale.

For these sectors, getting the marketing and selling right can be fine-tuned where necessary and with the exception and risk of provoking a negative reputation, businesses in these sectors do have an element of forgiveness compared to niche sectors.

By their definition, niche sectors contain only a limited number of prospects that are likely to know each other or get to know each other over time when people within the niche meet at trade shows or even move jobs within that sector.

More important is the number of chances you have to get it right before your business goes out of business.

For a business operating in a comparatively broad sector like the mobile network provider mentioned above, having six upset customers for whatever reason could be put down to a very bad day at the office.

If you sell within a sector with only six potential customers then six upset customers means you have to shut up shop and go fishing instead.

In other words, niche business-to-business selling only allows you a limited number of lottery tickets.

You therefore have to get it right first time and keep it right.


2. Due diligence

The people making the buying decision are expected to apply due diligence both in their final decision and during the process towards reaching that decision. Company policy, objectives and often regulations and law are key parts of this process.


3. Your prospects are paid to make the right decision

In consumer selling, the prospect is likely making the buying decision based on his or her own preferences and interests and is not being paid by anyone else in order to get the buying decision correct.

In business-to-business buying, your prospect is being paid to make the right decision in the interests of the company for which the buyer is employed.


4. Buying consequences

The consequences to a consumer of making the wrong buying decision are often confined to the purpose and function of the product or service. Sometimes, making the wrong decision can be profound for a consumer but often it is no more than an irritation.

The consequences for people employed to make the right buying decision in business-to-business procurement are wider reaching in that bonuses, promotion prospects and even the job itself can be negatively or positively affected by a buying decision.

In other words, making the right buying decision for the company might ultimately depend on whether the buyer can pay his or her mortgage or whether their child attends private school.


5. The experience of proactive repeat buying

The repeated process of developing and managing a purchasing process involving the same collection of potential suppliers and even individuals will undoubtedly evolve an experience curve that you have to be aware of.

With the experience curve comes misconceptions and sometimes embedded bias. Experience is not a perfect or accurate quality. In fact, challenging a prospect’s confidence in his or her own perceived infallibility is the essence of predatory business-to-business sales development.


6. Multiple moments of contact

A chain of multiple contact moments with the prospect or prospects before the sale is often part of the process in business-to-business selling. This is in contrast to consumer selling which trends towards single meeting situations.


7. Time lag contact points

There are often time lags between each contact with the prospect or prospects. Time lags cause interruption, increasing noise and decay of the previous work invested by the seller in the prospect. See Contact Sales Mapping.


8. The advantage of repeat buying

Some business sectors offer the advantage of repeat or frequent buying. This means you can build close relationships and even friendships that can last over whole careers. This trust bond can bind an account and help resist competitor and new entrant attempts to take your business.

Conversely, winning business from a competitor can require the breaking into an existing close friendship between a competitor and prospect.

Other sectors may be large project based and the sale may be massive but infrequent. The issue here is developing a strategy that can deliver sales scalability (the ability to deliver a consistently growing business built on ever increasing sales turnover and profit).

Often in these circumstances the business can only reach a certain level of growth due to the drain of profit in having to stay in existence between projects.


9. Business relationships

Close business relationships often provoke trust and loyalty. These relationships begin in one of two ways. Either an existing relationship enables you to obtain the business or a friendship develops as a consequence of a working relationship following the winning of the business.

Most people spend more day time with work colleagues than they do with their own family: this includes thinking about and liaising with extended work colleagues such as customers and suppliers.

Being liked and appreciated is therefore an important ingredient to obtaining and keeping business associates.

Being disliked for whatever reason is therefore not good for business.

Ironically, close business relationships can leave you commercially vulnerable. Relying on a close relationship to keep business might be a problem if you fall out with someone or if that person leaves, retires or dies.

It is at this moment that the replacement will objectively assess why in fact your business had their business. And if a valid and distinct reason does not present itself then the replacement may see an opportunity to make his or her mark and make a commercially improved decision for the company.

The replacement may even have his or her own close relationship to pull into the situation.

In other words, no matter how close your relationship with a customer, always review and insure that your business continues to deliver sound commercial benefits; ideally, unbeatable commercial benefits. Let others perceive your close relationship with your contact as almost irrelevant.

From the perspective of business development, you can also use the vulnerability of relationship based business to your advantage. Keeping your CRM up to date and your finger on the pulse of a prospect’s relationship with a competitor will enable you to pounce on a situation when the timing is right.

When a key contact within a prospect business leaves, retires or dies then you know changes are afoot – particularly if you also know that the incumbent had a close relationship with your competitor. Seek the commercial weakness of that previous relationship and make your case.


10. Tendering

From the perspective of the buyer, the tendering process presents a potentially more organised assessment of suppliers in that the randomness of choosing a supplier is reduced. In reality, the process can be a clinical or even sterile process based on price. This often removes the ability to assess potential suppliers from a wider context.

The risk of choosing an unsuitable supplier can therefore increase because the tender specification is determined only by the buyer and is not evolved or enhanced through interaction with suppliers during the procurement process.


11. Wider strategic considerations

Sometimes, the decision to buy from a particular company can be due to wider strategic or tactical considerations. These can be beyond the immediate logical reasons and arguments as to why the prospect should really be buying from you and can therefore appear totally mysterious as to why the decision didn’t go your way.

There are many situations where such tactics are executed. Examples include ambitions for vertical integration to tactical moves in response to competition.

More often it is the common strategic practice of Supplier Convergence where as a matter of policy and objective, the purchasing function within a business must source and use a range of similar suppliers in order to mitigate risk against over reliance on a supplier that may go out of business or dictate prices.

A successful Supplier Convergence strategy will deliver more cost effective buying in that a collection of similar suppliers with similar products and services will only be left with price or more favourable credit terms in order to compete.


12. Decision Making Unit (DMU)

Decision Making Units are groups of two or more people that contribute either formally or informally to a decision.

DMUs are common within organisations and understanding their dynamics is crucial in winning sales in the business-to-business environment.

For a full explanation of DMUs click Decision Making Units in B2B sales

The extent to which DMUs influence formal tendering processes is frankly debatable in that a tendering process (even a closed tendering process) must still conclude with a decision. How these decisions are reached will often involve some form of DMU.


Limiting the weakness of unsubstantiated internal opinion in business-to-business selling

Logging the status of a prospect as being warm or cold is often down to the sales person’s opinion – either stated in Call Reports, the CRM (Customer Relationship Management data) or at summary sales meetings.

There is a conflict of interest inherent to this method in that it is not always in the interest of the sales person to provide an honest and detailed account of what is really going on.

The sales person is under pressure to perform and has limited time to go into detail as to why this prospect is slipping away.

Often the sales person honestly doesn’t know what is happening and is therefore reluctant to drop the potential business from the list. After all, it’s better to keep this potential business on the list until something else comes along to replace it.

In many companies, the prospect list tends to get a clean up when business is good. The problem with this practice is that you may get a distorted view of how effective your task mix is in achieving your objectives.


Sales in comparison to competition

Keeping a close eye on your CRM data should deliver changes in trends and also provide heads-up on sudden anomalies. You should also have a journal in the CRM (a Wiki) of previous competitor activities and how effective they were.

For example, if you suddenly discover you are losing business to a competitor then you need to find out why. Is it because a competitor has introduced a change in strategy or is its current strategy now bearing fruit?


A few typical reasons of why competition is generally taking business from you in the business-to-business environment

  • Skinny bidding – This is the practice of providing an initial price based on the minimum requirement to meet the specification.Once the bid has been won then the well-trained sales team will attempt to up-sale additional features and services using well-rehearsed procedures.This strategy is more likely in price-pressure markets or where the prospect is unrealistic in its cost-lead purchasing.Skinny bidding can slow down the completion of a project and can cause complications during the commissioning of the project.
  • Lower prices.
  • Products with more relevant features that deliver wanted benefits.
  • Better aftersales service.
  • Better organised, comprehensive and energetic sales efforts.
  • Personal contacts.
  • Ex-employee sending you down the river.
  • Potent marketing.
  • More active marketing.

Time pressures compromising your sales efforts

Usually it is the sales person that has to endure pressure of time due to having to hit sales targets.

Some buyers even step up price negotiation towards the end of the calender month because they know this is when the sales team get desperate: its a bit like reduced must-clear prices in a supermarket late on Saturdays.

Switching the pressure of time to the prospect is sometimes attempted by offering special discounts for a limited time only. This might work more in retail but in business-to-business sectors, any worthwhile buyer will seize on that price and hold you to it at their convenience. And once the price drops down, it is a hard job to increase it back up.


Using time to enhance your sales efforts

This is where a good CRM system and diligent procedures starts to earn their keep. One of the key functions of business-to-business sales and its interaction with the CRM is to qualify timing.

This means getting close to an accurate estimate of when the prospect is:

  1. Going to want the product or service delivered.
  2. When the prospect is going to place the project to tender (provide the specification request quote etc.).
  3. When the prospect is going to make the buying decision.

When you know this detail on a project then the pressure of time is either made inert (because all things are structured and organised) or even moved to your favour if the prospect is presented with a panic situation in that they simply must have delivery by a short date.


Maybes are the death of a salesman

This is the never-ending promise; the prospect that promises a lot but never delivers.

Potential reasons for this are:

  • The prospect does not have the courage to simply tell you to go away.
  • The prospect does want to buy but is held up or waiting on higher management.
  • The prospect is disorganised and does not know what day it is.
  • The prospect wants to buy but not now.

If you allow it, Maybes can sit on your nearly won list for years. Be brutal, be realistic and scratch them from your list. Security blanket Maybes do not pay the bills.