#21: Writing a bid

In my last article we went through the tendering process and how to get the best from your relationships with potential clients. Now we turn our attention to bid writing.

It is worthwhile spending time crafting a quality bid or proposal, as this will be the reference point on your offering when you are not in the prospect’s presence. I was very fortunate a few years ago to attend a workshop on Successfully Consultancy, hosted by the Institute of Directors, at which Harold Lewis shared some top tips on crafting a bid, which included:

1. Do your research.
2. Weigh up the competitive opportunity.
3. Read tender documents thoroughly.
4. Plan the bid writing process.
5. Follow all clients’ instructions.
6. Treat policy statements seriously.
7. Focus on client priorities and your distinctive value.
8. Justify everything.
9. Be honest and realistic.
10. Work on clarity.

I would like to add some further flavour to one of these tips, and then add one more.

So, firstly, preparation in general, and research in particular.

It pays to take every opportunity when you can interact with the potential client to glean more information and context. People buy people before they buy the service, so these are good opportunities to build empathy and rapport.

Put yourself in the buyer’s shoes – what’s going on in their world? If you can ask questions that lead to outcome-based objectives, so much the better. In addition makes sure you study their website, and any social media activity in which they engage. Finally, look for any recent press coverage, which might give clues on what is going on in the business.

And the additional point. In terms of stakeholder management, do keep in mind that there may be more than one party involved in the recommendation/decision, and that they may have different agendas.

So, if you can, try to weave in something that plays to these different audiences, their issues and concerns, and the way in which they like to receive information. If this challenge strikes a chord, do feel free to contact me and we can develop it further. Next time we will look at presenting your bid.

#20: Path to assent

Over the past few articles we have covered how to find business clients, the preconditions associated with these business deals and how to secure them. Now it is time to talk about how to get the best out of the tendering process, and how to win an unfair share of competitive bids, which sometimes come into play even on small assignments.

Understanding the prospect, and playing to his or her mindset, is critical if you are going to be successful. We will talk about writing and presenting bids in future articles, but at this stage it is helpful to focus on the preparatory stage i.e. preparing for an exploratory or fact-finding meeting.

It will be helpful to keep in mind the attitude and mindset of the prospect, and whilst each situation will inevitably differ, there are certain steps on the path to assent which will apply most of the time:

1. Letting prospects know that they are important and that their business is important to you.
2. Appreciating that they have an existing point of view which needs to be respected.
3. Convincing them that you have a solution or idea that can help them.
4. Outlining the
5. Reinforcing how the idea will help and make a genuine difference.
6. Giving them the time they need to make a buy decision themselves.

You will not necessarily complete all these stages at one meeting, but it helps to keep them in mind as you build your picture of the prospect and his or her world.

The evolution of the relationship you are trying to build with the prospect – and remember people buy people before they buy a product or service – may look something like this:

• A meeting is agreed.
• A relationship is established.
• A conceptual agreement on outcomes is reached – this will include objectives, how to measure progress, and the value to the buyer’s business.
• A proposal is crafted and presented.

If you keep this evolution in mind it may help you to come up with an effective tendering process capable of successful replication.

Next time we will look at writing a bid and the ten top tips for doing this effectively to get the best results. Don’t miss it!

#19: Asking for the business

Having talked about Sales Qualification and Pipeline Management as key components of the sales process, let us turn our attention to Asking for the Business.

Firstly, a quick comment on some of the things that crop up in sales meetings:

1. Remember to differentiate between the features (what it is) and the benefits (what’s in it for the buyer) of your offering.
2. If you are asked what your USP (Unique Selling Point or Unique Selling Proposition) is, make sure you have a response – silence will not help your cause.
3. If you are asked for proof that you can do what you say are offering, ensure you have some options up your sleeve – e.g. qualifications, case studies, testimonials. The crucial issue is to “de-risk” the decision from the buyer’s perspective.

Secondly, when discussing price, try to have 2 approaches in mind. If it is a straightforward requirement, quote the price and then stay silent – you don’t need to justify it. On the other hand, if it is complicated then merely state that you will go away, work it out, and have a firm figure to the prospect within a certain period.

Whatever you do avoid thinking out loud in front of the prospect – a rocky road to losing the sale. If you get pushback on price, think about whether you can trade time and not money e.g. if you have offered a “modular” solution then take out a couple of modules if you are prepared to lower the price.

Finally, develop a few ways of asking for the business with which you are comfortable. A couple of examples that have worked well for me are:

1. The “alternative close” – would you like to start this month or next month (the “will you buy it or will you buy it” approach)
2. The “summary close” – you have identified several benefits which would arise from doing this work (repeat them); should we therefore put a date in the diary to make a start?

In a perfect world you create a situation where the prospect wants to but from you rather than you sell to them, but the world isn’t perfect, so you need a few tips and hints that you can employ. I hope these help and remember you can always contact me for advice and information.

#18: Pipeline Management

Last time we talked about Sales Qualification as a key component of the sales process. This time we will look at Pipeline Management.

The first aspect to consider is the sales pipeline itself. As you gather names you will end up with a range of prospects at different stages of evolution. It will help you if you can track each prospect at each stage so that you keep it moving, hopefully with some momentum, in the right direction. The typical stages you would track (with potential likelihood of success) could include:

1. Target = 0%
2. Contact established = 10%
3. Positive meeting = 20%
4. Tender submitted = 30%
5. Negotiations/discussions = 50%
6. Verbal o.k. or email = 75%
7. Purchase order/contract = 100%

By way of example, if you have moved a target to stage 5, you may well believe you have a 50-50 chance of success, so you allocate a 50% factor to the value of the work i.e. a £3,000 contract would be ascribed a value of £1,500 at that stage. If you do this for your entire pipeline list of names you can not only track status and action required, but ascribe a figure to your potential future cash flow.

The second aspect is conversion ratios. It is helpful to set and then, with experience, adjust how many targets you need to pursue to get the number of clients you need i.e. how many “targets” do you need to have at stage 1 to get the number of clients you need making it to stage 7.

The third aspect is having some mechanisms for dealing with sales that seem stuck somewhere in the process. Andrew Sobel talks about “6 preconditions to create a buyer”:

1. The client perceives a problem or opportunity that is significant in size and importance.
2. The client has a healthy dissatisfaction with the rate of change.
3. The client believes there is a material lack of internal resource and/or expertise.
4. The client trusts that you can do it.
5. The executive sponsor feels that the right stakeholders have all been aligned around retaining you and utilising your approach.
6. They can see tangible next steps to move forward.

If any of these preconditions are missing, then the sales process will stall. So it is always worth checking back with potential clients to gauge how present these six preconditions are.

Next time we will assume that these preconditions have indeed been met, and consider how to ask for the business.

#17: Sales qualification

Following on from my past few articles on direct, indirect and other routes to market, it is now time to turn out attention to Sales Qualification, and why this is a key component of the sales process.

Having a Sales Qualification Process is very important. It has a number of purposes:

1. It will help you to turn strangers in to cash in the bank.
2. You can profile the clients you want (as opposed to merely accepting those who find you).
3. You can weed out potential timewasters.
4. You can weed out bad debts.

The sorts of things you would want to cover in your sales qualification would include:

• Source of lead or referral – where did the opportunity come from? Is it from a trusted source, who you know would only pass you a qualified opportunity, or is it a less trusted resource that may be passing you a problem?
• Potential size of transaction – if it’s huge, don’t just rub your hands together with delight; think about whether you can actually deliver or whether you would embarrass yourself if you could not cope. If it’s tiny, don’t decline out of hand; think about whether you are being tested, and if you do a good job will you get something more substantial down the line.
• Size of company – in days gone by, the larger the company the more likely they would be there to pay you when you finish the work. But the current economic climate has indicated this is not necessarily the case. With smaller businesses you may want to check their ability to pay. There are credit checks you can do by using agencies that have access to the same databases that the banks have; they normally do debt recovery also! This is obviously for business-to-business (B2B). The credit cycle with retail clients is obviously a great deal shorter.
• Identification of decision maker – nothing is more frustrating than pitching to the wrong person. If you have identified the decision maker – that’s great, go for it. If not, can you positively influence the person who is representing your interests to give a good account of your proposition? Make sure you understand the decision-making process.
• Identification of budget – find out if your prospect has a budget. If the prospect has not allocated a budget, then how serious are they?
• Clarity of requirement – are you clear in your mind what the client wants and whether you can deliver it?
• Urgency of requirement – Is this mission critical for them or not? If it’s not, then if they get busy could it cease to be important?
• Finally, why are they talking to you? What has prompted them to contact you? Are they serious about getting a quote or are you just there to make up the numbers? If that is the case, you do not want to waste your time if there is no chance to win the business.

If you stop and think for a moment, you can begin to appreciate that, if you follow this process every time, you will have eliminated all the reasons for not wanting to sell to the prospect. Equally, the prospect has eliminated all the reasons for not wanting to buy from you! So, he or she is going to be surprised if you don’t ask for the business – but we’ll come back to that in a future article.

#16: Routes to market – Other

As we have covered in the last two articles, when considering sales one of the first things to think about are routes to market. So far we have looked at  “direct” and “indirect”. This week we will take a slightly different tack.

Let’s consider two extremes of activity for a moment. At one end of the spectrum there are assignments you are perfectly capable of winning and delivering on your own. If you can “fill your boots” using either the direct or indirect routes then fine – long may that continue! At the other end of the spectrum you may be able to act as an associate of a much bigger institution, securing work which may often be otherwise beyond you, as it requires a significant delivery team of which you are one member. Normally nice work from you can get it; you may have to operate at a lower rate than you could secure independently, but you have normally had no client acquisition cost – you just have to turn up and do the work.

If you find that these two extremes are not sufficient to fill your diary, then there are a couple more you can consider.

Firstly, you can try to identify people who do similar things to you and where, if you teamed up, you could win work none of you could win on your own. I teamed up with two other consultants and we ran a 6-module leadership development programme, delivering two modules each.

Secondly, you can try to identify other professional firms where you can develop the reciprocity approach we talked about under “indirect” routes. In addition to referring prospects to each other, you could run joint events/seminars/campaigns on linked or related topics. I have run a number of seminars with lawyers and accountants which have been well received. One which worked particularly well was a breakfast seminar which I ran with a firm of lawyers, where we looked, through a couple of case studies from our own experience, at real-life examples of board-room dilemmas, and challenged the group to consider what they would do if they were a Non-Exec director of the business. It was great fun (I have to confess we injected a little bit of “Gallows Humour” for dramatic effect!) but some good learning points were uncovered.

In conclusion, do broaden your thinking to consider alternative routes to market. Some will work better for you than others, but unless you explore them all you will never know which ones.

Next time we will start looking at Sales Qualification, and why this is a key component of the sales process. Until then, feel free to contact me should you have any questions or queries.

#15: Routes to market – Indirect

As we covered in my previous article, one of the first things to think about when considering sales are your routes to market – how many would you say you have? Last time we looked at the most obvious one – what I call “direct”. This week we will look at “indirect”.

Reciprocal is the first type of the indirect marketing route. This is where you identify people you like and trust, and who are ready, willing and able to refer qualified opportunities to you, in the expectation that you would be equally prepared to do the same for them. In this type of arrangement, which is informal, no money changes hands. You are much better off having a handful of these types of relationships that really deliver, rather than a vast number that deliver nothing and effectively waste your time.

The second type is fee-based, preferably on a mutual as opposed to one-way basis. This, in effect, means that the originator of the opportunity pays the other a fee for sourcing the work. This can be a significant source of business for you, but you need to bear a few things in mind:

• There has to be a platform of mutual trust to begin with, otherwise you have nothing to build on.
• The arrangement has to be documented.
• The fee split has to be sufficiently interesting to motivate people to spend time finding work for you (and vice versa of course!). I would suggest 10% of revenue if it is a straight referral, maybe up to 20% if the other party is actively involved in the sales process and actually helps you close the deal.
• The duration of the agreement should probably be finite – again I would suggest 12 months from when the works starts; in year two you are in all likelihood being retained on your own efforts.
• There needs to be transparency and honesty at all times between you and the other party in terms of work undertaken and fees earned.

                                                                                                                                                                            So, in the case of this route to market, you are succeeding or failing based on your ability to build relationships with others who will channel meaningful and relevant opportunities to you.

In my next article, we will look at how you can take this one step further and identify people with whom you can collaborate to win business you could not win on your own.

#14: Routes to market – Direct

Now that we have moved on from looking at the main success factors you need to start a successful sole practitioner consultancy, it is time to turn our attention to what you need to look at next to progress further; sales.

When considering sales, one of the first things to think about is routes to market – how many do you have? We all have more than one; it’s just a case of figuring out just how many. In this article we will deal with the most obvious one – what I call “direct”.

What would classify a sale as direct? Several factors:

1. You identify the potential client as a prospect in the first place. You have assessed his or her potential interest in your offering based on sector, size, location and so on…

2. You make direct contact with the client, by one of the following mechanisms:

• Networking (either at a formal networking group, or opportunistically at a seminar, conference, trade fair etc.)
• Cold approach – letter, email, phone call…
• Social media – an initial relationship with the prospect is built via one or more of the sites – LinkedIn, Twitter, Facebook
• Subscription – the prospect registers on your website to receive further information prompted by blogs, newsletters, other articles.

3. You handle the sales process at all stages with little or no intervention from anybody else on your behalf.

4. Your “cost of sales”, or client acquisition cost, relates to your efforts and initiatives – no one else’s, e.g. networking subscription fees, direct marketing campaign, travel, entertainment. One notable exception could be if you are retaining someone else to create marketing collateral for you i.e. a freelance copywriter.

So, in the case of this route to market, you are succeeding or failing based on your own lead generation efforts. Next time, we will look at how you can involve others in strengthening your sales pipeline.

#13: Price integrity

Over the past few articles, we have been looking at the three main success factors you need to establish the overall framework of a successful sole practitioner consultancy. So far we have looked at Self-Awareness and Clarity of Purpose. Today it’s the turn of Price Integrity.

There are 6 tips I would invite you to consider in terms of establishing price integrity:

1. Try to price based on value created not time expended. This is far from easy, but if you don’t try it won’t happen! It is very dangerous to assume that there is always a direct correlation between the time you commit and what you are paid.

• Consider the range of activities you undertake; could some of them be described as “commodity”, and some as “value-add”? By way of example, a sole practitioner accountant probably has a range of activities that could be described as commodity (preparing a set of accounts), but may also have some activities where he is genuinely making a difference (devising and implementing an efficient tax management strategy). These probably deserve different levels of reward.

2.Consider pricing options. Does your business lend itself to Day Rate, Fixed Fee, Performance-Related, or a hybrid of these? I have used all of these at different times.

3. Structure proposals on a modular basis. The reason for this is you can then trade time for money, and not just face having to concede, i.e. if the client baulks at the price you can just take a module out and bring the price down accordingly.

4. Know your worth. If you are offering a “Rolls-Royce” service, the prospect will be confused if you are offering a bargain basement price. You need to stay in line with the market, and match your pricing to your overall strategy – low cost offering/niche offering/differentiated offering – with the latter two representing the best opportunities to price at the top of the market.

5. Be prepared to take a degree of risk – this brings us back to the performance-related aspect. I have on occasions done work where I have offered the prospect a choice between a full day rate or a lower day rate,     with a performance “kicker” if a target increase in pre-tax profit is achieved by a certain date (and on a formula agreed with the client’s accountant so there can be no “misunderstandings”).

6. Be prepared to walk away. If you sense that you are viewed as a cost as opposed to an investment then, unless your model is to be a low cost provider, or there is some form of ulterior motive, you should think long and hard before agreeing to undertake work at an unsatisfactory fee level.

Now that we have covered the three success factors you need to set yourself up as a successful consultant, it time for you to implement them. I hope this list of tips is helpful for you, let me know how you get on if you try them out!

#12: Clarity of purpose

When establishing the overall framework for a successful sole practitioner consultancy, we cited three key success factors for people to consider when setting up as a consultant – Self-Awareness, Clarity of Purpose, and Price Integrity. My last article looked at Self-Awareness, so today we will consider the second of these in greater detail.

It is really important that you are clear in your own mind what it is that you are offering, as without that clarity it will be hard for you to articulate to your prospects what your offering is. Below I have set out 10 questions which you may want to ask yourself. If you can answer these 10 questions in a robust manner, then you are pretty much “good-to-go”:

1. What business do I want to be in?
2. What do I want my business to look like 5 years from now?
3. What key values and principles are going to guide me?
4. Who is my audience?
5. How will I market my offering?
6. How will I run my business?
7. What help do I need to run my business?
8. What are my financial targets?
9. How will I measure my performance?
10. What does my Action Plan look like?

Try capturing your answers to these questions in a one-page plan to keep your approach crisp and concise.

A final thought for you; Michael W. McLaughlin wrote a fantastic article entitled “Creating a Service Offer Your Prospects Can’t Refuse”. In the article he said the following:

“Before most clients buy anything, they expect evidence that shows you can answer three questions:

1. Do you understand the as-is state that creates the need for outside help?
2. Do you have a vision of the future in which the current problem becomes a distant memory?
3. What is that path to a brighter future?

If your service offer misses any of these questions, it’s a dud”

Worth reflecting on…

In my next article we will look at your business skills inventory and the last of the three key success factors, Price Integrity.