The short answer: A team lost six months of a negotiation to a competitor they could not match on price, and concluded the deal was gone because of it. They were right that they could not match it and wrong that it mattered. The room they had been persuading was not the room that would decide, and the argument they were making was not the one that would land where the decision actually sat.
I was there for the numbers, not for the deal. I want that on the record early, because it is half of why I saw it.
We were selling something big and expensive to a large buyer. A competitor had come in underneath us on price, and not by a little: they were priced where we could not have gone and still covered our own costs, which is what a company does when it wants the market more than it wants the margin. You cannot answer that with a discount.
Six months of negotiation had produced nothing. Then the deal team concluded it was finished. We could not compete on price, so that was that. That was not defeatism. The numbers had been run and the numbers were correct.
How do you find out who actually decides?
Work backwards from who bears the consequence, not forwards from the org chart. In this case that meant asking who was actually going to make the decision.
Not who we were meeting. Who decides.
Because six months of a competent argument had moved the room precisely nowhere. Which is worth stopping on. If a sound argument makes no progress over months, the useful conclusion is usually not that the argument is weak.
Two things can produce that. The person cannot decide, or the person has already decided. Either way you are not in a negotiation, you are in a routine, and either way the fix is the same.
What mattered was that the people we had been meeting were not the people who owned the consequence of the decision. Somebody else did, and that somebody had a different relationship to the money than anyone we had spoken to.
So my question was blunt. Why keep making the case to a room it has not moved in half a year?
Getting into the right room
The team asked whether I could arrange it.
I could, roughly, because I had relationships on that side that nobody had thought to use, which is what happens when you spend years being unglamorous with the people who actually run things. Those relationships had never been useful before. That is normally what they are like right up until the day they are the only thing that works.
We got the meeting.
The half that mattered more
Getting into the room was the part everyone remembers. It was not the part that won.
Because if we had walked in and made the same argument again, we would have lost again, just faster. A different listener is not a different case. The new room was not going to be persuaded by the specification comparison that had already failed in the old one, and price was still price.
So I worked out what was actually being bought, which was not the thing we were selling.
Someone was buying the decision still being right in five years. Someone was buying not being the person who bought the cheap one. Our name meant something specific, and the competitor’s meant something else.
The argument I offered was a comparison anyone in that room would feel without needing a table of numbers: this is a known name against a name nobody present could vouch for. Nobody buys the second one to save money if the first one is what they will be judged on.
That is not a specification argument. It is not even really a quality argument. It is an argument about what the buyer is protecting.
They used it. We won an eight figure contract that had been written off six months earlier.
What I actually did
Two things, and neither was clever.
I asked who decides, when everyone else had accepted the answer they were handed in the first meeting six months earlier.
I asked what that person is buying, rather than what we were selling.
Both are the same move, which is the move in every one of these cases: the team had a well-formed answer to a question nobody had checked. The question was “how do we win this deal on price,” and it was unanswerable, and it was also not the question.
Why does the same argument work on one buyer and fail on another?
Because different people are buying different things with the same purchase.
One person is buying the lowest cost they can defend to their board. Another is buying not being blamed if it fails. Another is buying what the choice says about them. The specification sheet is identical for all three, and the decision criterion is completely different, so an argument aimed at the wrong one does not sound wrong. It sounds irrelevant, which is worse, because nobody argues back and you learn nothing.
I want to be careful with one thing here, because this can be read as a manipulation technique and it is not one. The quality difference we were describing was real and widely known. Saying so in the language of what the buyer valued is not a trick. Saying it in the language of a specification table nobody in that room was going to read is just a failure to communicate, dressed up as rigour.
So what
If you are losing a deal on price, before you improve the offer, check two things you have probably not checked since the first meeting.
Is the person you are persuading the person who decides? Not the person who owns the relationship, or who was introduced to you, or whose job description says so. The person who bears the consequence of the decision.
Are you arguing about what they care about? You inherited your argument from your own product. They will decide on what they are protecting.
If months have gone by and a good argument has not moved, that is data about the room, not about the argument.
If a deal of yours has stopped moving and you would rather find out why before the clock does it for you, that is what I do for money, and I will tell you when the answer is that you do not need me.
Everything above is first hand. No company, industry, market or person is named, the figure is given only as a band, and identifying details have been omitted or generalized. There is no external research cited here, because I have not found any that measures the thing I am describing, and I would rather say that than attach a citation that does not support the claim.
Related reading
- Being Right Is the Cheap Half: seeing it is not the hard part; being believed is.
- Everyone Hit Their Number: what to do when the visible dispute is the evidence and nobody reads it that way.