You Got a Check. Did You Really Win?

In last week’s post, I gave an example of a company that won a deal, but learned something very important about its pricing structure.

Below, I’m going to share a little more about the deal. After reviewing this information, tell me if you think this company is winning business or not.

“They don’t demonstrate their products. I have never met a representative from FlashNet* in person, and that has a lot to do with my rating. They have never shown up. They are definitely not getting the share of business that they could get because of it. I can guarantee it. “I’ll give you an example: we bought a 20 TB storage area network. 10 TB is currently installed, and were looking at upgrading it. They’re in the storage networking business, so they wouldn’t come see us; they were not even in the list of potential vendors because of that reason. It’s that simple.

“Lunch meetings do make business. They have never visited us. I’ll give you an example: I probably spend about $1 million to $2 million in Cisco equipment a year. Last year, I only spent about $60,000 with FlashNet; this year, I probably spent about $200,000 with them. For the last four years, they have only had a small portion of my overall Cisco business, and when you look at it from an enterprise perspective—for example, we just spent $20 million on a new clinical information system—out of $20 million, FlashNet received no money from that project. We have a budget of $30 million, and FlashNet received just $60,000 of that. It’s because they will not fly anybody out here.

“They don’t have a presence out here, and that’s unfortunate for them. They are a good vendor; it’s unfortunate that they will not come out to meet their customers.”

*Name changed to maintain confidentiality

The fact of the matter is that FlashNet got a check and sold some stuff, but they received less than 1% of the total budget and 0% of a project where they had a potentially strong solution. FlashNet is probably getting a little money just because it is an incumbent in some part of the client's business.

This is probably not a unique case. How many times is FlashNet losing because of a short-sighted decision not to travel and visit? There may be logistical reasons, but this client is located in a suburb of Portland, Oregon; hardly the backwaters of the B2B sales world. Last I checked, Portland has an airport and rental car services.

Do you think that FlashNet will make any changes to its processes based on the information above? I hope so. I hope this information goes to the executive level rather than being shelved with all of the other dusty reports. I’ll probably never know. But, if I were an exec, this is the kind of intelligence I would need.

I would stop high-fiving the sales guy for winning $60K and start asking questions about why we’re not taking $5M.

If you feel differently, or if I’m missing something, let me know (cdalley@primary-intel.com, 801-838-9600 x5050)

And, if you want this type of intelligence on your new customers and lost prospects, Primary Intelligence does this kind of stuff every day.