Latest / Sales Leadership with Fexingo: Quota Carriers, Sales Managers, and Revenue Teams / The Sales Rep Who Lost a Deal on Purpose and Won
Transcript
- Lucas: So there's this sales rep at a mid-size cybersecurity firm — we'll call her Sarah — and she's in a final presentation with a potential client, a logistics company, and the deal is worth about two hundred thousand dollars. Luna: That's a solid deal for a mid-market rep. What happened? Lucas: The buyer says, 'We need you to build a custom integration that you don't currently offer. It would take your engineering team three months. If you can't do it, we can't sign.' Luna: Standard pressure play. Some reps would just promise it and figure it out later. Lucas: Right, but Sarah did something that sounds crazy in a sales culture obsessed with closing. She said, 'I don't think we're the right fit for you right now. Let's revisit in six months.' And she walked away. Luna: She walked away from two hundred grand? Did her manager lose it? Lucas: Her manager was furious. But here's the kicker — six months later, the logistics company came back. The integration they wanted was no longer a priority, and their security needs had only grown. They signed a million-two deal. Luna: So she lost a battle to win the war. But that takes serious conviction. Lucas: It does. And I think this tactic — intentionally losing a deal — is one of the most underused moves in enterprise sales. But it has to be done right. You can't just flippantly walk away. There's a psychology behind it. Luna: Let's unpack that. Because most sales training is about handling objections and closing, not about knowing when to fold. Lucas: Exactly. The first question is — why would you ever do this? The main reason is to preserve long-term trust. If you promise a custom integration that your product doesn't support, you either fail to deliver — which destroys credibility — or you force your engineering team into a nightmare that burns resources. Luna: And then you might lose the deal anyway, but now your reputation is damaged. Lucas: Right. So walking away signals that you prioritize the buyer's long-term success over a short-term commission. But there's a second reason: it resets the power dynamic. When you say, 'I don't think we're ready for each other,' the buyer suddenly has to justify why they should work with you. Luna: That's a huge psychological shift. Now they're selling you on the deal. Lucas: Exactly. And it only works if you're genuine. If the buyer senses you're playing a game, you lose trust forever. So the first rule is: you genuinely believe this deal will hurt the relationship or your company. That's the only time you use it. Luna: So how do you know when it's real? What's the litmus test? Lucas: I think there are three conditions. One: the requested customization or discount would fundamentally change your product or profitability. Two: the buyer is in a highly competitive market and will likely come back — if the market is stagnant, they might not return. Three: you have a strong enough pipeline that you can afford to lose this deal. If you're desperate, you can't pull this off. Luna: So Sarah had that luxury. But what about a rep who's behind quota in Q3? Walking away seems impossible. Lucas: It's harder, but not impossible. You have to consider the long-term cost of a bad deal. A two-hundred-thousand-dollar deal that creates a bad reference could cost you millions in future referrals. So even if you're behind, sometimes the best move is to walk. Luna: That takes real discipline. Most organizations don't reward that behavior. Lucas: They don't. And that's a problem. Sales culture is so focused on monthly or quarterly quotas that it doesn't account for the value of a preserved relationship. But leaders who want to build sustainable revenue should encourage this thinking. Luna: How do you actually communicate it to the buyer? You can't just say 'we're not a good fit'. That sounds like a brush-off. Lucas: You have to be specific. Sarah said something like: 'I appreciate the opportunity, but based on what you need today, I don't think we can deliver a solution that meets your expectations without significant compromises. That's not fair to you or to us. I'd rather be honest now than let you down later. Let's check back in six months and see if our product or your needs have evolved.' Luna: That's respectful. It also leaves the door open without being pushy. Lucas: Exactly. And the key is to tie it to the buyer's interests. You're protecting them from a bad decision. That builds more trust than any discount ever could. Luna: I want to talk about the risk side. What if they never come back? Then you've just lost a deal for nothing. Lucas: That's the real risk. And you have to accept that it might happen. But here's the thing — if you had closed the deal under the original terms, you'd likely have a dissatisfied customer who churns, or a product team that hates you. Either way, you lose in the long run. So the risk of walking is often lower than the risk of saying yes. Luna: That's a good framing. It's not about avoiding loss, it's about choosing the lesser loss. Lucas: Right. And there's data to back this up. In a study by the Sales Management Association, companies that encouraged reps to walk away from bad-fit deals had 23% higher customer retention rates over three years. And their average deal size actually grew 11% year-over-year because they were focusing on the right accounts. Luna: So it's not just feel-good advice. There's empirical support. Lucas: Exactly. So I think for sales leaders listening, the question is: how do you create a culture where a rep can walk away without being penalized? One idea is to track 'relationship preservation' as a metric — not just closed deals. Reward reps who flag risky deals and handle them honestly. Luna: That would require a shift in how success is measured. Many comp plans don't account for that. Lucas: They don't. But some progressive companies are starting to add a 'customer health score' component to compensation. It's not widespread yet, but it's coming. Luna: I want to come back to Sarah's story. How did she handle her manager? Because that's a real obstacle. Lucas: She had to explain her reasoning after the fact. She documented the buyer's requests and why they were problematic. She showed her manager that if they had agreed, the engineering cost would have wiped out any profit on that deal. And she promised to keep the relationship warm. She sent quarterly check-in emails, shared relevant content, and stayed top of mind without being salesy. Luna: That's crucial. Walking away doesn't mean going silent. You have to nurture the relationship. Lucas: Exactly. And when the buyer came back, they said the reason they chose Sarah was because she was the only rep who was honest enough to walk away. They had talked to other vendors who all promised the moon, but Sarah stood out. Luna: So it became a competitive advantage. That's powerful. Lucas: It is. And I think this is a tactic that works best in complex B2B sales where the buying cycle is long and relationships matter. It's less applicable in transactional sales where you might never see the customer again. Luna: Right. So context is everything. You wouldn't walk away from a SaaS monthly subscription deal. Lucas: Exactly. If your average deal size is under five thousand and the sales cycle is a week, this tactic doesn't make sense. But for six-figure enterprise deals, it's a valid tool. Luna: So beyond the walk-away itself, what are the specific steps a rep should take if they decide to do it? Lucas: First, confirm internally that you have leadership support, or at least that you're willing to accept the consequences. Second, prepare a clear, honest explanation for the buyer. Third, agree on a specific follow-up timeline — say, six months or a quarter. Fourth, schedule that follow-up before you leave the conversation. And fifth, during the follow-up, focus on adding value, not reopening the deal. Luna: That last point is key. If you reach out and immediately ask if they're ready to buy, you undo all the goodwill. Lucas: Bingo. You want to share an industry report, a new case study, or invite them to a webinar. You stay relevant without pressure. And when the timing is right, they'll bring up the opportunity themselves. Luna: One more thing — what if the buyer pushes back when you say you're walking? Like, 'No, we want to work with you, can't you figure it out?' Lucas: That can happen. In that case, you have to be firm but empathetic. You can say, 'I appreciate that, and I want to make this work, but I don't want to promise something I can't deliver. Let's brainstorm what we could do within our current capabilities.' Sometimes that opens a creative solution that avoids the impossible request. Luna: So it's not always an all-or-nothing door slam. It can be a pivot. Lucas: Right. The goal isn't to lose the deal — it's to preserve the relationship and find the right path forward, even if that path isn't today. Luna: This is really about long-term thinking in a short-term-focused profession. I think a lot of reps will hear this and think it's a luxury they can't afford. But as you said, the cost of a bad deal is often higher than the cost of walking. Lucas: And that's the core message. If these conversations have moved your work forward in some small way, we want to keep them coming without interruption. We deliberately don't run ads on these episodes. If you want to support that choice, the link is buy me a coffee dot com slash fexingo. Luna: Yeah, it's a small gesture that helps us stay independent and focused on content that actually helps sales teams. No pressure, just if it's meaningful to you. Lucas: Exactly. So back to Sarah — she ended up being promoted to enterprise sales manager within two years. The million-two deal was a huge part of her portfolio, and she used it as a case study to train new reps on when to walk away. Luna: That's a great win. And it shows that sometimes the best way to close is to be willing to not close. Lucas: Absolutely. So if you're a rep or a sales leader, I challenge you to think about one deal in your pipeline where walking away might be the strongest move you can make. It's counterintuitive, but it's honest — and honesty in sales is rare enough to be a competitive advantage. Luna: I love that. Thanks for the discussion, Lucas. Lucas: Thanks, Luna. Until next time.