The Key to Selling Savings to a Merchant

I’m going to share a story today.  It will illustrate a very simple key to selling savings to merchants.  This one key strategy will make all the difference in your pitch.  Perhaps you won’t have to learn it the hard way like I did.  Find out how to implement this deal clinching pitch in this episode.

Several years ago, I had hired a good telemarketer.  She had gotten appointments for me with some larger merchants.  I was excited about a meeting with the owner of a seven-location sandwich shop.  This was one of the first leads I had from my telemarketer.  The owner seemed interested.  He agreed to give me three statements.  One was from the location with the most volume, then the one with the least volume, and then from an average volume location.  Without the benefit of instantquotetool.com I took much time to create a nice spread sheet and proposal for each location.  My return visit to share savings results will never be forgotten!  The owner was a gruff, confrontational business man and seemed in a hurry when I came in.  I was rather nervous.  For some reason I decided to start with the smallest location.  As soon as I told him the savings for that location would be about $20 per month, he stopped me and said, “What?  You took my time, I gave you statements and scheduled appointments for $20 a month!?  I am not interested.  Get out of here.”  In vain I tried to tell him there were bigger monthly savings with the other locations.  But I could not get back into the conversation.  That was a terrible and disappointing interaction.

I was actually going to offer him a substantial savings of between $7,000 or $12,000 a year.  However, rather than saying, “I can save you $7,000 a year,” I decided to say, “I can save you $20 a month on your smallest location.”  I learned a valuable lesson by that experience.  Find the largest justifiable amount of savings and make sure that is the first number which comes out of your mouth! 

Here is an example of the pitch I should have used.  “Mr. Jones, I’ve got some great news for you.  I went to bat with the processor and got the rates down as low as I could.  First, let me share something of which you might not be aware.  In our industry right now, the average merchant stays with a processor about 44 months.  So, by rounding that to three years, I’m going to be able to save you about $2,000 even if you stay with me only for the minimum time frame.  Of course, my hope is for much, much longer!  That money will drop straight to the bottom line.  Let me just run through this proposal real quick and explain where those savings are coming from.”

If we break down those numbers, the merchant would be saving about $55 a month.  Even if the savings is only $30 a month, that is more than a thousand dollars in three years’ time.  But rather than mentioning $30 in the pitch, talk about saving over $1,000 or $2,000.  Always find the largest number. 

A second rule I follow is not to mention that monthly amount.  Even if the merchant says, “Okay, so that’s about $50 a month then?”  My reply is, “Yeah, over three years that’s $2,000.  Let me just break this down for you.”  The number isn’t going to come out of my mouth.  I’ve learned my lesson!  The first number merchants hear sticks in their minds.  I often include a little bit of a hook after it, too, “Over the course of three years, we could save you $2,000.  That money will drop straight to the bottom line.  I’m sure you’d agree with me.  That’s a pretty significant amount; isn’t it?

I’ve been amused in my consulting gigs and in talking to different processors by a trend which says, “Don’t pitch price.  Don’t pitch price.  Don’t pitch price.  The merchants don’t really care about price.  They care more about technology and service.”  However, if you sell in the field, you’ll find that selling is all about the price.  To transition the conversation to service and technology after dispensing with the price IS possible.  And to sell someone when you can’t provide a significant amount of savings, though more difficult, is also possible.

Are you an executive of a processing company or someone managing a team?  Are you bent on convincing your team of sales reps not to worry about pricing?  For those telling your reps they can sell merchants by talking about amazing customer service, that’s not true!  It doesn’t work.  Rather, help your team talk about the savings and pricing, then transition to service and technology.  Service and technology can absolutely take merchants over the line and close the deal.  Merchants don’t see savings as a differentiator; everybody offers savings.  However, they do look at savings as a requirement.

Perhaps you can offer only minimal savings per month, less than $10.  To verbally offer that amount of savings is not wise.  If that is the case, just match the price.  You could say, “Here is the situation.  First of all, you have a good deal with your company.  I’ll be the first to admit that.  But I’m sure that given the choice, you always try to support local business.  If you found a product sold locally which was exactly the same as something you’ve purchased from Walmart or Sam’s Club, you are going to support the local company, right?”  The merchant responds in the affirmative.  Then you continue, “Well, that is the situation we have here.  I really went to bat for you.  To compete with these big mega-processors is hard for us.  But they don’t provide the high level of service we do.  I was able to match their price.  It’s not going to cost you any additional money at all, but you are going to get that higher level of service.” Or “I’m going to provide you with this technology.”  Although transitioning in that way is much more difficult, it can be effective.

In summary:  (1) Have savings to pitch.  (2) Find the largest number that makes sense and go with that.  Don’t ever say the monthly savings.  (3) Without savings to offer, match their price and pitch supporting local business.

By the way, I mentioned this already.  But if you haven’t already gone to instantquotetool.com, be sure you sign up for the 30-day free trial.  I just rolled out four new training courses which will be available to you there.  So, check it out and sign up for your free trial today.

I hope this episode will keep you from learning the hard way.  Implement this deal clinching strategy to close your deals.

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