Interviewing for a consulting assignment I was asked ”do you have experience with M&A?” My immediate reply was “successful buys yes- successful implementations-no not really.” I was both too hasty and too forthcoming in my response. My only experience with acquisitions was with international companies, and there was always a flawed implementation to these acquisitions.
I have been involved in the turnarounds of three European subsidiary organizations. They were all initially acquisitions by an American parent. The initial acquisition or start-up was praised as net new local business, acquisition of new customers and a European footprint. Within 24 months, there were warning signs of stress., however, confrontation was avoided, so was corrective action. None of them existed in the present state as successful subsidiary organizations. Within a short period of time each was unprofitable, had lost customers and endured poor relations with the US parent. They ended up with changes to top local management and a corporate black eye with paralytic internal fear of future foreign acquisitions. Turnarounds were performed, but the scars were there far into the future.
What to do differently?
Acquisitions are difficult and even for the best planned ones, integrations will usually be harder. My conclusion is that there is a special skill set for integrating acquisitions. http://www.jimthomasintl.com/service-offerings.html. Most companies <$100MM in revenue have not been through this exercise so adding someone to the team with such experience will minimize the pitfalls of the integration. Lean on outside organizations resources for assistance e.g. www.acg.org , if you don’t have abundant internal resources.
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We all enjoy being nose to nose in negotiations and learning about people and their business problems. Some younger reps ask me to ride with them for customer visits. They sometimes talk too much, are a little unnatural with someone else with them and are not listening enough. Stick with your process and visit plan, however, put away the corporate canned script. Like any negotiation, review the buyer/seller possible scenarios below, it can unfold in almost any negotiation setting, professional or personal.
Buyers have become more sophisticated negotiators and are listening to everything you say in order to get a better deal. Responding to these buying signals is key to converting a prospect to a customer. Know when they are leaning to give you an order. Address and answer their question clearly and succinctly and stop. Pause 30 seconds. Ask for the order.
What are some examples of buying signals I have uncovered from others and ones encountered myself?
1. Repeated questions. When they repeat a question that has been answered fully already, or asking the same question twice in rapid succession. Example: "What was that you said about the premium model? How much did you say those were again?" They want to confirm the terms of the deal. Do it simple and straight forward
2. Risk-minimization questions. They're leaning toward a buying movement, yet they want to have their bases covered regarding risk. "So you said this comes with a warranty?" "How do I return it?" They want to minimize their risk and want you to be able to absorb that risk on their behalf. Explain how you handle returns and warranties. It says you have a policy and want to have a good reputation.
3. Delivery related questions. They again are leaning towards a purchase and want to further their expectation with an anticipated receipt. Tell them a range of dates of if you place the order now you can expect it in X days. Provide them a shipment tracker once the order is placed.
4. Customer Reference statements. They repeat a positive reference about you and your product from someone else in their organization or marketplace. They want you to ensure you will repeat that favorable experience for them.
5. Personal reference. They may want to know how long you have worked at this company, industry experience, where you live. They have bought into you and want you to be involved with you and your product and want that reassurance.
6. Competitive or historic negative experience. They are telling you the performance they expect and the hurdles you have to jump over.
Don’t waffle. Respond affirmatively with reassurance and grace. Wait a bit, at least 30 seconds, then ask for the order if they don't fill the void.
As my friend Craig Letty said to me “The purpose of the first meeting is to get the second meeting.” The purpose of the first order is to entitle you to the next order. Fulfill that first order, a timely follow up and you’re on your way to a great relationship and success.
Good luck and good selling!
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