Do you know when you’re the Rabbit?
I’m not talking about the cute little bunny rabbit with long ears and a
cotton tail. I’m talking about the type of rabbit used in dog races to get the dogs to race to the finish line. Without the rabbit, the dogs would never finish the race much less win. The thing you always know is the rabbit never wins. The rabbit is there for only one purpose which is to get the dogs to run so the dog owner can make money.
How many times have you worked hard to get a new customer’s business only to find out later that they never had any intention to buy from you? They were either using you for price comparison (little intent to buy), keeping their guy honest (no intent to buy) or worse using you as a negotiating tool (the rabbit).
Price Comparison
I think we may all be guilty of comparing prices even when we have little intention of changing who we’re currently buying from. We use comparison shopping to confirm we are making good decisions. If you find a better price and before buying from someone else you will probably go back to your regular supplier and ask them to get right on the pricing. This is probably a good business practice and we have grown to expect such. I would be very disappointed if a good customer of ours finds a lower price and doesn’t give us the opportunity to justify or adjust our pricing. I can say that I am disappointed when we have the best price and a new customer chooses to stay with their current supplier but I can understand.
Keeping their guy Honest
I don’t know how honest it is to use someone just to keep their guy honest. I may be quibbling over phrasing between this and price comparison but to me this shows no interest or intent to change their present supplier. In most cases the customer will not ask a tremendous amount of effort from us. They are usually not going to spend much time making a decision unless our proposal is considerably less or much better than their current supplier’s. If their current supplier proves to be “not competitive” this may lead to an opportunity for good faith negotiations to begin.
Using you as a Negotiating Tool (Rabbit)
This can be possibly the biggest waste of energies and resources (money) that you and your sales team can have. You are the rabbit if you are brought into a project (sometimes quite large) and asked to provide pricing for the sole purpose of the customer using your pricing to negotiate pricing with a competitor with no intent to use you. For this to work, the customer has to convince you that you are a contender and they want your products or services. The understanding or promise is they are engaging you in good faith negotiations and if successful you will get the business. The better they can sell this promise the harder they know you will be willing to work for their business. The harder they can get you to work, meaning the more you will lower your price, the less they will have to do when they sit down with the real contender for this business. This method of negotiation while usually very effective is intentionally misleading. When it is exposed, a trusting business relationship with that customer is almost impossible.
Please don’t mistake my comments above to think that when you walk in to a new customer’s office and they don’t immediately start giving you their business that you are the rabbit. That is usually not the case
and certainly not my intent. Almost always your customer will follow a normal sales cycle. You must earn your way into their business and gain their trust before being welcomed to the final negotiation table.
In the early stages of negotiation it is very hard to determine if the negotiations are being done in good faith or not. You certainly will assume so until you start to see the signs that this may not be the case.
In my next post, I will discuss how to see the signs and start to recognize if you are the rabbit. If you have any examples of being the rabbit or being rabbited (if that’s a word) that you would like to share, please leave a comment below or send me an email at feedback@wewaonthenet.com.
Recent Comments