The procurement function gets a lot of stick.
Organisations that supply services to big client companies (especially agencies) frequently complain about that they see as mean procurement departments. ‘They beat us up on price’. ‘They make us jump through all sorts of hoops’. ‘They impose tough payment terms on us’.
I’ve been known to say the same sort of thing myself!
But there’s a big truth out there: procurement’s job is to buy raw materials, goods and services for their company, and to do it selfishly. That’s because we all buy selfishly. We want things on our terms, at the lowest possible price, provided the quality is OK. The language is littered with sayings and aphorisms to underline this point.
“They are so desperate for the business, they’ll drop the price in the end”
“Never pay more than you have to”.
But the buyer can be sceptical too.
“No such a thing as a free lunch”.
“Pay peanuts, get monkeys”.
It is unrealistic to expect your commercial equation to defy the laws of gravity – whether you are an agency seeking a higher fee, or if you are trying to sell your house in a depressed market. Buyers will be buyers. But the other side of the coin is rather less obvious. If you want to be a success in sales, you can’t sell selfishly. If you sell what you want to sell, at the price you want to get, on the terms you insist on, you are likely to have very limited success.
That’s because we have to sell generously. We need to work out what people want to buy. We have to allow people to choose. We must get the pricing right. We are obliged to offer terms the buyer will accept.
Yet so often, we come across ungenerous sellers:
• The take it or leave it mentality
• Agencies that tell the client there’s only one creative solution, only one photographer, only one director
• Inflexible media deals, that aren’t deals, precisely because they are inflexible
• The used car that’s too pricey, or the house seller that won’t drop their price
Selfish buying demands generous selling. Hard-nosed buying makes sense. Hard-nosed selling makes none. Unless you are very tough – or very, very good.Read More