On Being Battered by a Large Bank // Part 1

A few weeks ago I was speaking to the CFO of a medium-sized software company. “How’s business going” I asked? He replied, ruefully: “I spend most of my time being battered by large banks”.

 

So, in response, this email and the next 2 or 3 are going to look at the sales-contracting process as it applies when you are a small or medium-sized company and selling to a large bank or other organisation with a heavyweight Procurement department.

The good news is that large banks and their Procurement departments are predictable. They all operate more or less the same way. This means that you can anticipate how they will behave, plan for it and, to an extent, manage it.

The bad news is that you will not be able to entirely avoid the process nor some element of battering. The trick is to manage the process as effectively as possible so that a) the deal gets done quickly, and b) you have protected your margin.

There are three main parts to this:

  1. The Sales-Side Set Up
  2. Boxing Clever
  3. Good Negotiating Skills

Before I talk about the Sales-Side Set Up (next week), it’s important to recognise how the Procurement process is going to work. You may have been talking to Ms Y (your sponsor at the bank) for three years, you may have built a great relationship with her, and you may both have a really clear understanding of the proposed deal.

And that’s all great, but Procurement doesn’t care. They will do their procurement thing and, in a tightly run organisation, Ms Y will be excluded from the process.

How to handle this, and other tips and tricks, will be in next week’s post.

And that’s all great, but Procurement doesn’t care. They will do their procurement thing...