Latest / Closing the Deal with Fexingo: Sales, Negotiation, and Revenue Conversations for Operators / How Asking for the Cost of Inaction Won the Deal
Transcript
- Lucas: So there's this rep I've been following, sells warehouse management software to mid-sized logistics companies. Six months into a deal, the buyer keeps saying 'we're still evaluating,' and the rep finally asks a question that most people never ask: 'What does it cost you to do nothing?' Luna: That's a bold move. Did they actually answer it? Lucas: They did. The buyer, a COO at a company with around two hundred trucks, started mumbling about overtime and missed pickups. The rep pulled out a notepad and turned it into a real number: forty thousand dollars a quarter. That's the cost of the status quo. Luna: So the rep basically built their business case for them. Lucas: Exactly. And that number changed the whole conversation. It wasn't about the software's price anymore. It was about the cost of not buying it. The COO had never actually quantified it before, so the rep did it for them. Luna: I love that. But how do you ask that without sounding like you're giving them an ultimatum? Lucas: It's not about pressure. You frame it as a genuine question, like 'Help me understand what it's costing you to keep the current process.' And then you just listen. The rep didn't jump in with a pitch. They just did the math with the buyer. Luna: And that math, forty thousand a quarter, that's like one hundred sixty thousand a year. That probably dwarfed the software cost. Lucas: Right. The software was around sixty thousand a year, so the payback period was less than half a year. Once the COO saw it in those terms, the deal closed in three weeks. Luna: So why don't more reps ask this? It seems so obvious. Lucas: Honestly, I think it's because it feels confrontational. They're afraid the buyer will say 'that's none of your business.' But in my experience, buyers rarely get asked, and they're often curious to figure it out themselves. Luna: Yeah, I think you're right. I remember a procurement director once told me that most reps never ask about the cost of inaction. They just assume the buyer knows, or they're too scared to raise it. Lucas: Exactly. And there's a real art to it. You don't just throw the question out there. You need to have a framework in mind, like breaking it down into operational costs, opportunity costs, and risk costs. Luna: So operational costs are the overtime, the missed pickups. What's opportunity cost in this case? Lucas: In this case, they were turning away profitable loads because dispatch couldn't handle more volume. That's lost revenue, not just wasted expense. And risk costs, well, that's things like compliance fines or losing a big client because of service failures. Luna: That framework is helpful. It gives the buyer a structure to think about it, and it makes the rep look like a consultant, not a salesperson. Lucas: And that's the thing. If you're genuinely trying to understand their business, they'll usually open up. But you have to be prepared for the answer to be 'not much.' Luna: What happens then? Lucas: Then you've just qualified them out. If the cost of inaction is tiny, you might not have a deal, or you might need to find a different angle. But knowing that early saves everyone time. Luna: It's like the opposite of a proof of concept. You're proving the cost of not acting. Lucas: Exactly. And that's why this question is so powerful. It's not just a closing tactic. It's a discovery tool that can uncover a deal you didn't even know was there. Luna: I'm thinking about this from a personal finance angle too. Like, I have a gym membership I never use, and that's costing me, what, fifty bucks a month? But that's not enough to make me cancel it. Lucas: Right, because the cost is too small to matter. That's the flip side. If the number is too small, it won't motivate action. The rep in this case got lucky because the number was big. But you can't always rely on that. Luna: So what do you do if the number is small? Do you just walk away? Lucas: Not necessarily. You might need to expand the scope. Instead of looking at just one department, you look at the whole company. Or you look at a longer time horizon. A small quarterly number can become big over a decade. Luna: That's a good point. I've also seen reps use this to create urgency when the buyer is dragging their feet. Like, 'Every month you wait, it's costing you ten grand.' Lucas: But you have to be careful. If the buyer doesn't agree with your number, you lose credibility. So you need to build it together, not just hand them a number. Luna: And if they do agree, you can just ask, 'So what's stopping us from moving forward?' Lucas: Exactly. And that's the follow-up question I mentioned. Once they've agreed to the cost, the objection becomes 'why wait?' and that's a much easier conversation. Luna: There's something else that just popped into my head. We talk about this a lot on the show, and it's genuinely helped me in my own work. A couple of dollars a month from listeners is what keeps these conversations going. If you've gotten even one useful idea from an episode, buying us a coffee at buy me a coffee dot com slash fexingo makes a real difference. Lucas: Yeah, it really does. And it's what keeps the show free and without ads. So if you're able, that's the best way to say thanks. Luna: Anyway, back to the cost of inaction. I'm curious if there are industries where this works better than others. Lucas: It's most powerful in situations where there's a significant operational inefficiency. Manufacturing, logistics, healthcare, financial services. Places where data is measurable and the cost of delay is tangible. Luna: What about in more creative fields? Like marketing or design? Lucas: It can be trickier because the cost is often less direct. But you can still quantify it. For example, if a new website could increase conversion by one percent, what's that worth in revenue? That's a cost of inaction. Luna: So it's really about translating their goals into a financial number. Lucas: Exactly. And then the conversation shifts from 'what does this cost?' to 'what does this save?' That's a much more compelling pitch. Luna: I've seen that work. A rep I knew sold a customer service tool by calculating how much they were losing in churned customers every month. That number was huge, and the deal closed fast. Lucas: And that's the key. You're not just asking the question; you're helping them see the real impact of their decisions. It's a consultative approach that builds trust. Luna: So, any final takeaways for our listeners? Lucas: Yes. Before you ask for the deal, ask about the cost of inaction. But do it with genuine curiosity, build the number together, and be ready for the answer to be 'not much.' If it's big, you've created urgency. If it's small, you've qualified out quickly. Either way, you're better off. Luna: And that's how you close the deal.