When do you "kill" a deal?

For sales professionals this is one of the toughest questions they will ask themselves. It's also one of the toughest decisions they will make because of their confidence in their own abilities to close the deal or "turn the situation around." At their behavioral core, they want the deal and they want to close the business. It's the nature of how good salespeople are wired and it's why they are in the business of sales.

To their detriment, many salespeople will invest excessive time, money, energy and company resources in an effort to close the deal. Standard sales theory encourages salespeople to treat customers as rational thinking people who have an interest in achieving a mutually successful outcome from the sales interaction. Why: because that's the way it's supposed to be; in theory.

Standard sales theory breaks down however when salespeople forget to recognize that customers are subject to biases that undermine their objectivity in putting together a deal that is mutually beneficial to their company and the salesperson. When biases are present the likelihood that it will become a "bad deal" for the salesperson and their company increases dramatically.

Bad deals can systematically put salespeople out of a job and companies out of business. The stakes for salespeople's required business savvy is higher than ever before. Pricing and profit strategies must be well thought out in order to avoid reacting to buyer bias and agreeing to a bad deal.

While the business and financial components provide a clearer direction for when to "kill a deal," emphasis should also be placed on the behavioral mis-alignments and buyer biases that will never allow a deal to advance beyond "bad."

When to "kill" a deal:

Ø      When the loss of profit doesn't justify continued activity.

Ø      When it's costing more to maintain the business and relationship than it would to discontinue it.

Ø      When no amount of money is worth the agony of the deal or relationship.

Ø      When your value proposition hasn't, isn't and won't be understood or paid for by the customer.

Ø      When you are asked to compromise your ethics, values or principles.

Ø      When what their buying isn't what your selling and you try to "force fit" simply to get the sale for volume or to "cover overhead."

Ø      When there's no strategy associated with reduced margin and it becomes an accepted practice.

Rational decisions aren't made in a vacuum. Each deal should be thought through using these guidelines to improve your business and sales position.