There are two questions you can expect from any prospect if you ask for their involvement in any sales activity: "What's the size of this deal?" and "What's it going to cost to get it?" They want to know all the numbers that will be added and subtracted from the revenue that the pending sale will generate. You should want to know the same things about any business opportunity you undertake, especially if it requires a time-consuming presentation.
What's the ultimate reward of a sales presentation? In the short term, it may only be a single sale. In the long term, it's a series of sales. But you can't just look at the upside.
There are at least three specific risks involved with preparing and making any sales presentation. Let's look at each one.
Risk No. 1: Financial
How much do you think it costs for you to deliver a presentation to a prospect? To find out, use the following formulas for each of the following four "direct" cost categories for any given presentation, then add up all four of your totals for the total cost of any given presentation:
- Category 1: Your time (in hours) x hourly rate = $X. Take your last year's total earnings (base and commission plus any bonus), and divide that number by 2,000, which is a rough estimate of the average number of working hours in a year.
- Category 2: Technical support (in hours) x hourly rate = $X. Will you require assistance from any technical support personnel?
- Category 3: Administrative support (in hours) x hourly rate = $. Will you require any assistance from any administrative personnel?
- Category 4: Management support (in hours) x hourly rate = $. Will you require any assistance from any of your managers? Will they be required to be present for all or any part of your presentation?
Risk No. 2: Opportunity
While you and your support personnel are preparing for and conducting this presentation, guess what? You won't be doing anything else. That means passing on other opportunities that come your way during this time. Here are two important questions to ask your prospect's top officer before you devote any time to a presentation:
2. Ms. Robertson, what will you need from our team in order to be convinced that we are the best choice to be your business partner?
You must get answers to these questions before you or any of your team members spend any time developing a presentation. If you want a rough estimate of the opportunity price tag at stake, take 10 percent of the revenue you generate on a monthly basis, then add it to the total of your financial risk.
Tony Parinello has become the nation's foremost expert on executive-level selling. He's also the author of the bestselling book bearing the name of his sales training program,Getting to VITO, the Very Important Top Officer, 10 Steps to VITO's Office,as well as the host of Club VITO, a weekly live internet broadcast.