The challenge faced by many salespeople is their inability to establish tangible value when the product sold is nothing more than a commodity. To that, I respond, “Nothing is a commodity.” The total cost of doing business is greater than the price.
The products you sell are, of course, commodities when they arrive on the rail car or truck to the back of your yard or warehouse. The moment they are unloaded, however, they are no longer commodities…at least in the hands of a capable sales leader. Take the case of Toby, a lumber salesman with years of technical experience under his belt.
At a jobsite with a builder in the process of rehabbing an old house with an extended roof gable, the builder reviewed the list of materials for pricing and presumed that two LVL beams would be needed to complete the job. Toby listened intently to the builder until he was finished. Then he asked why the builder wouldn’t just allow him to deliver a 28′ LVL to create a continuous structural beam. The builder was surprised and eagerly accepted the offer of a simpler solution.
This is the case of a salesperson utilizing the exact same “commodities” as other salespeople in the market while coming up with a resource to which the builder was previously unaware. This issue of LBM Journal highlights features of EWP, an example of our industry taking standard products and creating solutions that are usually simple to you as a lumber expert, while at first being unknown to your buyers.
Toby’s story provides an anecdotal example of a salesperson overcoming the commodity mindset yet fails to answer why so many salespeople feel like commodity brokers. The answer to the latter question is simple: Speed.
Speed and urgency are the enemy of profits. These are the tools of negotiation, whether intended or not, of many buyers. They are as pressed for time as are all members of humanity these days. They see the relationship between buyer and supplier as a quick transaction that is best handled by asking for bids and comparing prices.
Salespeople, with few arrows in their quivers, default to the path of least resistance and accommodate the pressure for “price first and ask questions later” business relationships. Wise sales leaders conversely slow the process down and get all the details prior to pricing a project. They recognize that the products they sell might be commodities, but still require an understanding of engineering applications, lead-time planning, and education for the builder’s staff members.
Salespeople, without thinking too forwardly, presume that the builder understands all the specific engineering details of various products. Wise sales leaders recognize that the things they take for granted might be new to a builder responsible for coordinating dozens of products and trades on every project.
Salespeople, without considering the changes that are occurring in our industry above and beyond product developments (for example, technology conveniences to make design and communication more effective) default to old methods of communication. Wise sales leaders introduce technology that enables the builder to work and communicate more efficiently with vendors.
Buyers are not in the habit of training salespeople to do their jobs better. Instead, they will default to the easiest practices that reduce the products you sell to mere commodities. You have the power to deliver value above and beyond the underlying price of the goods you sell. The price is the amount paid by the buyer. The total cost includes the amount of time and energy needed for each step of the process.
Wise salespeople might not have the lowest price while still creating the lowest overall cost, and therefore greatest value. In other words, the products you sell may be commodities, but you’re not.
Rick Davis is the Sales Education Leader for ABC Supply and the President of Building Leaders. You can buy his books or learn more about his online sales training platform at buildingleaders.com.