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How to Spar With Procurement and Legal

April 05, 2012 | Comments: 0 | Views: 129

In this article on 'how you can avoid the most bruising buyer encounters' we will take a look at sparing with procurement and legal.

Procurement: A Surprise Left-Hook!

Sellers have learned to fear the involvement of procurement - particularly when it happens close to the point of a contract being awarded. For the buyer, however, involving procurement can often be an astute move.

By bringing in procurement late in the day, the buying organization is:

  • Taking advantage of the fact that, at the end of a long buying process, both buyer and seller may be 'running out of steam', i.e. the buyer passes the baton to procurement, while the seller has nobody to hand it on to.
  • Playing divide and conquer, with procurement often playing a 'bad cop' role, coming in to do the dirty work of hammering the seller on price.

Sellers tell horror-stories of procurement arriving on the scene after months of discussion, threatening to undo the progress that has been made and calling into question key aspects of the contract and its terms.

It may be an overly simplistic view, but procurement, in the seller's mind, is likely to:

  • Hammer the supplier on price.
  • Isolate the seller from existing relationships with buyer-managers.
  • Place additional requirements in terms of a formalized tendering process.
  • Bring other suppliers to the table.

As most sellers have witnessed these risks are greatest where procurement has little domain or project-specific knowledge or expertise.

How to Spar With Procurement?

How can you side-step a left hook from procurement? Well, seeking out procurement earlier will give you a better understanding of their role, as well as their motivation, power/influence and past form. Armed with these insights, you are less likely to be taken off-guard by their sudden arrival.

If the manager-buyer, or sponsor, cannot guide you in preparing for procurement, then learn from other suppliers and their experiences in selling to the same company.

Sales Contracts: A Sideswipe from Legal!

The champagne has been drained and now all that remains is the paperwork. However, as sellers have learned, they are particularly vulnerable at the contract stage. It is as if the seller is about to step out of the ring when, all of a sudden, legal deals a painful sideswipe.

The manager-buyer may stress the point that signing will be straightforward, but just wait until legal gets involved. Most buyers don't like vendor contracts full-stop; when it comes to signing them, it is often surprising the issues that arise.

Whenever a buying organization drags its heels on signing, it keeps the successful supplier on tender-hooks and almost inevitably delays the project start- or delivery date.

Where resources have been put aside for the project, it means the supplier has started to incur costs that may not be recoverable. Moreover, as these resources are likely to have been taken from other projects, it means there are likely to be opportunity as well as direct costs involved.

In addition, of course, there are the legal costs that the seller may have to bear, as well as the additional hours involved on the part of the sales team.

How To Spar With Legal?

Here are five useful tips on how sellers can avoid being bruised at the contract stage:

  1. Try to better understand the buying organization's processes, procedures and track record/form in respect of supplier contracts and 'legals'.
  2. Anticipate in advance the issues that are likely to arise.
  3. Include delays and associated problems in respect of 'legals' as a key risk in sales forecasting, as well as in project-planning.
  4. Involve legal on both sides earlier.
  5. Where possible, simplify all legal and contractual documentation, including the use of standard contract terms, or templates that have been approved by professional bodies etc.

To read more about this topic, please visit The ASG Group website.

John O'Gorman is a Business to Business sales coach, Director of The ASG Group and co-author of the ground-breaking book, The B2B Sales Revolution. For more information on The ASG Group or to contact John, please visit the company website at, where you can download quality whitepapers on B2B Sales.

Source: EzineArticles
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