…and Drives Proposal Conversion Rates and Profitability
If a potential client told a member of your sales team “There are many others who do the same thing as your company, but at lower prices” how do you think they would respond? Most often they would cite all the features and benefits of your products and services, and possibly throw in the fact you always exceed customer expectations (whatever they may be).
Wrong response…if you’re really intent on driving proposal conversion rates and profitability.
A McKinsey study of 2,400 companies found 1% more price yields an 11% increase in operating income. This is huge. Just think what affect this would have on your business, e.g., expanded products and services, operational improvements, hiring additional employees, or simply taking it to the bank.
But many companies are in highly competitive industries, including energy efficiency. And the potential risk of losing volume is too great for a point or two of additional price, even considering the considerable impact to the bottom line.
The solution to driving the conversion rate and profitability of your projects, while maintaining existing sales volumes, is to define the value of your products and services clearly and succinctly.
Added Value of Energy Efficiency Upgrades
Studies that concluded energy efficient buildings have:
- Higher rental and occupancy rates
- Lower utility costs
- Increased sales prices
- Higher employee productivity
- Reduced maintenance costs
It’s All About What Sets You Apart from the Competition…Your Differentiators
But it can be argued these are “generic” benefits. That is, they can be realized regardless of who’s doing the upgrade. This is true… assuming comparable performing products, quality levels, installation processes, total cost of ownership, user-friendly controls, etc. But this is seldom the case. It’s a good bet your competitors won’t address them. If they even talk about the value of their upgrades, it’s usually focused on reduced energy consumption and the associated savings.
It’s your differentiators that set you apart from the competition and do the best job of achieving these results. They are key to increasing conversion rates and achieving the higher prices that drive bottom line performance.
The most critical differentiator is your employees. Also important is how you work, manage projects and any specialized equipment or tools you use. Include these resources, processes, and capabilities in your proposals.
Employees: Your employees are often the most important differentiator￼
- Their experience and knowhow enable coming up with optimal client solutions.
- This is especially true if they are knowledgeable about older systems that can be economically brought up to date, avoiding the cost of a totally new replacement. Clients always appreciate options.
- In promoting your employees, identify and promote their record of professional accomplishment, certifications, industry recognition and awards. Also note how they keep abreast of the latest technology.
How you work: Explain how you will do the work
- What special practices do you follow?
- Are you ISO certified?
- Do you adhere to all OSHA safety guidelines?
- Can you work outside a customer’s business hours to minimize disruption? Are you an end-to-end provider with single-source capabilities?
- Poor project management – the leading cause of failure in technical projects
- Do you provide a comprehensive timeline, so your customer knows what to expect and when?
- Emphasize the value-added components of your management approach. Do you have regular site visits to ensure all work is code compliant and quality standards are being met?
- How will you handle change orders and cost overruns?
Specialized equipment or tools: If the project will benefit from special equipment or tools that only you, or very few have, mention them
- Smartphone access
- Open architecture for controls
- Customization tools
- Infrared cameras for detecting heat loss
Your differentiators should also be part of every conversation your sales and marketing teams have with potential clients, as well as be prominently figured on your website and in all marketing collateral material.