Latest / Closing Sales in Nigeria - Sales For The Nigerian Business Person: The Sales and Marketing Blueprint / Estimates vs. Quotes: How to Handle Price Changes Without Losing Customers

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Estimates vs. Quotes: How to Handle Price Changes Without Losing Customers · Closing Sales in Nigeria - Sales For The Nigerian Business Person: The Sales and Marketing Blueprint

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  Lots of Nigerian business people, sales people and
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  entrepreneurs are not aware of how the use of language or the
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  use of words can set up expectations when talking to
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  potential customers and potential clients.
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  So this is one of the things that we are going to be looking
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  at today. Now the reason why we're looking
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  at that today is because in conversations that I've been
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  having with some of my clients over the last week, it's
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  something that we've been trying to tackle.
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  And I figured, let me just come over here and share some of that
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  goodness as well. Now one of those words in
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  particular is quotation. Now lots of people don't realize
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  that when you're having a conversation with a potential
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  customer, a potential client, and you are based in an industry
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  where things are subject to change, like FX for instance,
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  Forex. So you buy things from the
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  original equipment manufacturer and your products are priced in
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  dollars. It's not very feasible for you
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  to give somebody a quote, you know, today on the 1st of
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  January and then, you know, maybe February 14th.
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  You know, the, the potential customer thinks that you're
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  still going to honor that price. Even though, you know, things
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  might have gone up or down, you know, there might have been wars
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  here or there that affect the cost of oil, that affect the
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  cost of FX, that affect the cost of, you know, different kinds of
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  things. So if you are someone in those
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  kinds of industries, you want to be very careful before you tell
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  somebody that you are giving them a quote or that you have
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  issued A quotation. Because when people hear
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  quotation, they have fixed expectations regarding price.
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  Let me repeat. If I tell you that I've given
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  you a quote, your own understanding is, Oh yeah, that
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  number is locked in. So even though you buzzed me 3
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  weeks later, you expect that I figure is good to go because I
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  told you that now, quote, I issue you.
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  So we should be careful. When people hear quotation, they
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  have fixed expectations regarding price.
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  Now for my clients, what we've been working on changing, that's
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  one client, particularly the solar space.
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  If I want to use a solar example, we've been trying to
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  work on how instead of saying quote, because any small thing
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  they're on the phone, they'll say, oh, let me issue you a
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  quote, I need, blah, blah, blah, blah, blah, blah.
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  So I can issue you a quote. I'm going to send you the quote
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  tomorrow. I'm going to, you know, every
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  single time, quote, quote, quote, quote, quote, what people
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  are hearing is fixed expectations regarding price.
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  So we're now trying to switch things up and start saying
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  estimates instead. When you hear estimate,
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  ordinarily estimate just means, you know, now rough idea, you
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  know, it's not really set in stone jaws, you know, take care.
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  I'm just for guidance. But it's not as if this thing is
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  fixed. So you're having a conversation
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  with a potential customer, telling them I'm sending you a
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  quote. It's not the same thing as
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  telling them, I am sending you an estimate.
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  Estimates can change. Estimates can be reviewed
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  upwards. In fact, the customer, when they
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  hear estimates, they're hoping that estimates can be reviewed
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  downwards. But either way, when people hear
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  estimates, they think, OK, this thing is subject to change.
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  So for those of you who are in industries where you know, any
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  sorting, you know, you know, American president invades Iran,
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  then the cost of oil, then the cost of FX.
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  All of a sudden, the things that I used to buy before at $88.00,
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  you now be buying it at, you know, $23.
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  And of course, if you're buying at $23, there's no how that you
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  can be selling at the old price because no one makes sense.
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  Somebody will eat the loss and it can be you who is eating the
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  loss. So if you're in that kind of
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  industry and that's the reason why we're using solar, stop
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  telling people quote, quote, quote, quote, quote, say no.
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  Now estimate that they give you, you talk to the person on the
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  phone. Oh, no problem.
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  Based on this, based on this, OK, I will give you estimates.
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  So between this and this, that not the estimate when we show on
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  site and I look at one or two things and no problem, I have
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  issue you quote, but that initial number that you're
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  throwing out that estimate, you do true, not quotation, not
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  quote, not invoice language can set expectations.
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  All right, So now estimate will be the issue.
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  Rough idea. That's what you're trying to
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  give them. Now the time will come
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  eventually for you to give a quote, but that is after you
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  have done a thorough qualification and discovery and
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  you know that you're dealing with a serious person who has a
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  need, who has a sense of urgency.
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  They have a sense of timelines. You know, they get ready to go,
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  no problem. You can give them quotes because
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  you know that these people are likely to take action anytime
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  soon is a good deal, but until you have done a thorough
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  qualification and discovery process, you can't just be
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  rushing and giving people quotes.
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  Just tell them that. Sure, that's not a problem.
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  I am willing to give you a couple of estimates.
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  In fact, we can talk tomorrow morning like about 10.
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  I have about 3 estimates I'd like us to go over.
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  How does that sound? So now estimate.
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  You go to estimate them while you are doing discovery.
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  Once you are done with discovery, you know that is a
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  serious person. They have a want, they have a
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  need they can afford, they're interested, they have a
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  timeline, they have a sense of urgency.
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  Good, bam, send them quotes. We can take it from them.
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  Then also another thing that we're working on with this
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  client that I'm currently working with is how we can
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  introduce this whole thing of validity for the estimates just
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  to inject a sense of urgency into the process.
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  Because when you say quotation, remember when you say quotation,
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  people assume that the price is fixed, you know, go change.
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  And it's been leading to some absurd situations where you
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  spoke to someone, no, 2-3 months ago and you know, the
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  conversation stalled. You're talking now and then you
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  bring up some new figures and they're like, but two months ago
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  you told me that is, you know, 10.2 million now, now you're
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  saying 13 million. How you see quotation versus
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  estimate and then also validity. So also something that some of
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  you might want to take note of for those of you who prices are
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  subject to rising and falling depending on, you know, the cost
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  of foreign exchange or the cost of oil or the cost of this or
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  the cost of that. For those of us who are in
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  consulting services, you know, we don't have this problem
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  because, you know, whether Donald Trump, you know, bombs
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  the moon or not, you know, has no effect on how much it is
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  already charge. But there's some people that are
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  tied into new cycles, capital flows, foreign exchange rate and
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  commodity prices and, you know, things like that.
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  So these are people that have to take note.
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  But either way, even for people in consulting circles, yeah, you
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  can. Yeah.
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  Validity will even work. So because it will make sense
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  for you to talk to somebody in January, then the conversation
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  stalls and then, you know, because of Tinbu economy, you
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  continue the conversation in August and then they expect that
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  they're going to pay the same price.
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  OK, yeah. So we should all be doing
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  estimate validity. So the plan that we have with
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  our people and you know, we're testing it.
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  So I'll let you know how how it goes.
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  So we still a triumph as we do it with clients.
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  I'll let you know the updates. You know how that is working.
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  But so far all we're doing is we're working with two weeks
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  just to inject urgency. So Madam Olga, no problem, we
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  can give you an estimate. Here is the estimate.
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  Estimate one, estimate 2 estimate 3.
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  But Olga, Please note these estimates are valid only for two
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  weeks until so, so, so and so date.
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  Are you are you good with that? They'll say yes and say OK,
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  cool. Most of our happiest clients
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  usually take about two to three days to look over these sorts of
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  things. So would it make sense for us to
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  continue the conversation on Tuesday?
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  Let's see which of these estimates you are growing fond
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  of. You know, something like that.
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  You secure an advancement. So let us use a case study.
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  And like I said today, the case study that we're going to use is
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  solar precisely because the people that were trying to work
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  on some of these issues with are a solar company.
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  But of course, I'm not going to use my clients real name.
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  So now let's pretend that we have an entrepreneur based in
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  Lagos and his name is Chidi. And Chidi has a company called
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  Brent Volt Solar. And Chidi has been having the
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  situations where he's been talking with somebody, but by
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  the time Chidi want to close or by the time Chidi they do follow
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  up, the customer will get angry because there's been price
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  change. So let's say there's a situation
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  where GED was talking to Missus Okoro and he gave Missus Okoro a
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  quote for 4.5 million, but that was just based on WhatsApp
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  photos, you know, because apparently in this industry it
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  seems OK that you guys talk about the phone, then you
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  exchange some WhatsApp photos. You say, OK, based on this, it
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  looks like he can take this panel, looks like he can take
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  that panel, blah, blah, blah, blah, blah.
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  And then, you know, you give a quote before a quote before
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  what's it called before inspection.
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  So let's say in this situation now that Chidi gave me Sissoko
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  record for 4.5 based on phone call and then based on WhatsApp
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  photo, but then she did not show up on site.
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  Then by the time Chidi climbed the roof now look around they
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  say oh boy, we suppose use reinforced mounting brackets
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  here. Then you know because of some
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  things when we're not seeing the picture we will need like around
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  our kind 20 meters extra cable. So because of that this quote
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  now Miss Okoro, this quote now we don't review arm you go pay
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  4.9. Now, of course, in that kind of
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  situation, Mrs. Okoro will be pissed like you told me 4.5 so
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  now 4.5 with in my mind, then all of a sudden 400K just enter
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  the picture from where should be pissed, man pissed.
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  And that's because language has been setting the wrong
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  expectations. When you tell Missus Okoro
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  quotation, Missus Okoro thinks fixed price.
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  That is our expectation. If you tell Missus Okoro no
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  problem. Now I'm all the Yan OK based on
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  WhatsApp, based on phone call, I think give you estimates
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  estimate could be like around that kind of 4.5.
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  If you tell somebody around that kind of 4.5 and then when you
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  show tomorrow, it turns out to be 4.9, no be estimates now
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  still estimate. It's not as if she'll be happy
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  then you know that Nigerian thing, you bounce back and forth
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  with a price groundnut here and there.
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  But at least if you tell somebody that 4.59 estimate then
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  no problem. You know the shock, no go too,
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  no go too much. But if you tell somebody quote,
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  as far as this person is concerned, price is fixed, 4.5
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  is 4.5. Which one are you telling me?
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  4.9 That is not what you told me.
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  That is not what you told me. The Enquirer go begin quire, go
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  not start. So this is what I recommend for
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  Chidi or anybody in that kind of situation.
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  At the initial stage, at the initial inquiry where you know,
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  somebody refers you to Miss Okoro or Missus Okoro got in
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  touch with you at that initial toasting stage.
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  Excuse me? You can just say something like,
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  OK, Missus Okoro, can I give you some estimates just to see if it
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  fits your budget? Is that OK with you?
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  Now, most people will say, yeah, sure, no problem.
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  Let us see the estimates. Let me know, Self.
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  Let me know, self, whether this is something I can proceed with
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  or not. So excuse me.
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  So excuse me about that. It's been a long day.
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  I've made two podcast episodes today.
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  Then I've also had two coaching calls.
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  Sorry, Yeah, I really should come up with a voice care
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  routine. You know, some people have been
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  telling me I should be drinking okra that is good for the voice
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  and a person. I should be eating his nail.
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  I guess it's time for me to try out those remedies and and see
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  how it works. OK, so as you tell Missus Okoro,
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  Yeah. Can I give you some estimates?
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  I just want to see if if it's your budget.
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  I just want to be sure that we're in the right correct
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  range. Miss Okoro says sure.
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  No problem. Then.
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  That's why you now start talking about validity.
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  You say Maram Okoro, this estimate where they give you is
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  valid just for two weeks. So now I told these people that
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  I'm currently training, you don't just say 2 weeks when
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  we're talking sales. Sometimes when it comes to
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  expectations, we suppose make a concrete.
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  So in this case, you don't just say Mr. Coro is valid for two
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  weeks. You say, Mr. Coro, these
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  estimates I've given you are valid for two weeks until the
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  7th of May. You can see now you have made
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  the concrete when you say valid for two weeks, you know, two
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  weeks differ. You know, two weeks is just
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  something that's hanging in somebody's head.
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  But if you say valid for two weeks until 7th of May when I
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  don't concretize them, you're setting some expectations down.
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  Now since we're talking about solar, where the price of things
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  can go up depending on where Donald Trump decides to bump or
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  it can go down depending on where you know fiscal policy.
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  You know, one thing, one thing and then foreign exchange the
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  price of dollar this and this price can go up or down.
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  It would make sense to explain to Mr. Coro in this case.
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  Now Mr. Coro, these estimates have given you are valid for two
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  weeks until the 7th of May. The reason why is because Madam
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  you know that foreign exchange dollar big issue in Niger.
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  And Madam I only deal with top notch quality.
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  I am buying direct from the OEM, from the original equipment
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  manufacturer. I'm buying direct from the
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  manufacturer straight from Germany.
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  Madam, you know Germany nadem get correct correct products.
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  Germany nadem be the king and queen of manufacturing and they
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  buy from Germany direct. So Madam Abed Novaks 2 weeks
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  this estimate because any small team dollar go up, price go up.
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  But of course Madam, I'm sure you know that if dollar come
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  down, price come down, she will laugh.
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  You see, just small talk. Then you will now transition
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  into getting an advancement. So you tell Madam Okoro that you
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  know what, I can issue you a final quote.
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  But that would depend we suppose.
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  Come for site visit first. Let me come and see everything
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  on my 2 core crore. I measure everything, you know?
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  Then that way I'll be able to give you a solid price that you
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  can rely on. OK, Madam, how you see him?
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  You know, you're trying to get an advancement.
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  You're trying to see if she's cool with that.
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  Let's just assume that Madam is cool with that.
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  Then you now try and get an advancement.
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  Advancement means you're trying to put something physical down
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  on the calendar. Sorry, advancement.
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  Really. What it really means is that you
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  and the person that you're talking to, the potential
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  customer, the potential clients, both of you are both mutually
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  agreeing that this is the next step that we're both, we're both
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  going to take to move this agenda forward.
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  So remember, it is only an advancement when both of you
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  agree. If you suggest something but the
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  other person says well, well, let's see, let's see is not an
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  advancement. Let's see is me.
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  I was proposing something. The person in committee person
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  just say well, you know, God willing anyway Mossy and that's
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  one advancement. An advancement is you say
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  Tuesday next week, Madam says, Oh no, actually I'll be on the
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  road on Tuesday. I'll be back in Lagos on
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  Thursday. It's a fantastic Thursday.
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  My calendar is free. So for that Thursday my which
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  one works for you morning, afternoon or evening?
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  So oh because of school runs this and this and that and that
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  I'll be back in the house around that kind 10 so oh ten OK, so
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  Madam Vivashob 10:30 will be would that be OK 10:30 is
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  perfect. That is an advancement.
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  You were talking, Mrs. Okoro was talking you put narrowed it down
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  initially you said Tuesday, she said no Thursday for Thursday
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  she said around that kind 10 you said OK Madam, what about 10:30?
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  She said no problem that is an advancement and that is how we
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  move deals forward. So, OK, no problem man.
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  So these are the estimates value for two weeks.
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  The site visit is going to be two weeks from now on Tuesday.
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  I mean, sorry, two weeks from now for do we say Thursday on
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  Thursday, 10:30 AM after that I can give you a formal quote that
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  is going to be locked in. But Miss Okoro, like I said, you
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  know, you know how this in the apple now we're only locking it
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  in just for one month. So this is how we're going to
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  move the thing forward. But the main thing the owner to
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  pass across to D is we should be careful with our use of language
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  because it is setting wrong expectations in the customer's
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  mind that is boxing or saying later on and that is also
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  unnecessary quarrel. So for those of you in the solar
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  space apart from solar, what again those of you in the export
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  yes, because my brother and I, we used to do export this used
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  to mess with us. You give somebody a quote and
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  then America will do this. America do that you know, next
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  thing bam, prices don't change and then things are not in our
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  favor. So that's the reason why export
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  solar who again oil, people that import from China and
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  Bangladesh, import from Germany, import from everywhere.
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  Don't be giving people quote, quote, quote.
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  Again when you say quote, the person thinks good fixed price.
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  That's the reason why they will talk to you in January, then
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  they'll call you up February 14th.
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  And so why I'm ready, I want to pay and they will now start
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  calling that. And that was January price, you
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  see? What do you mean?
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  That was January price. This is what you told me.
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  I went together myself and I'm not ready with 4.5.
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  You're now telling me it's 4.9. How so?
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  No more quote, quote, quote, quote, quote.
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  OK, you tell them it's an estimate.
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  Maybe we hear estimate. They know it's rough idea.
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  You give their estimate validity.
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  You don't just say 2 weeks. You say this estimate.
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  These estimates are valid for two weeks until December 21st.
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  That is something concrete. Don't just say 2 weeks, two
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  weeks away. Sounds in front, in front, in
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  front. Nobody is really thinking like
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  that. These quotes are valid for two
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  weeks until March 23rd like that.
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  So yeah, that's it. That's just what I want to talk
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  about today. So let's be careful with our use
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  of language before it puts us in a bind.
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  So that is it. If you found anything useful in
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  today's episode, if you've gotten value from today's
• 20:13
  episode and you'd love to connect with me, you can call
• 20:16
  me, send me a text message or a WhatsApp message on 08064662140.
• 20:24
  If you're interested in the 15 minute sale audit, you can
• 20:26
  WhatsApp me on the same number 08064662140.
• 20:33
  If you're shy and you just want to join my WhatsApp channel,
• 20:35
  that's not a problem. You can be there, get a load of
• 20:38
  all the updates, and then when you're brave enough, you can
• 20:40
  call me or you can send me a text message.
• 20:43
  So applying these principles can be tricky.
• 20:45
  If you need help, you want me to look at your particular
• 20:47
  circumstance. That's the reason why I give up
• 20:49
  my phone number. So get in touch and let's see if
• 20:53
  I can be of any help. So that's it for today.
• 20:56
  I'll catch you all some other time.