25. How do you use the higher authority strategy?
A good lesson learned a while back was from a sales person in Twin Falls, Idaho. A friend of his sold a service station to someone from another country that didn’t understand how we do business. The new owner would order a part from the auto supply store and then try to negotiate the price with the driver.
You may be thinking how anyone could do something that dumb. However, if we go into a customer's business and are not talking to the decision maker, we are doing the same thing.
Another perfect example of this strategy in action was demonstrated while checking into a hotel in North Platte, Nebraska. I asked the clerk at the front desk for a discount. She said she had to check with the manager and went back into the office. When she returned she said she was sorry but the manager said that was the best they could do. I walked over to the elevator and while waiting another person came in and asked for a discount. The clerk did the same thing only this time I could see the entire office. It was empty. She simply walked into the office, stood there for about five seconds and returned.
Sometimes a decision maker will use a “higher authority” to hide the fact that they are the decision maker. For example: "This agreement looks good, but I will have to run it by my committee (or wife or any other higher authority).”
Using the higher authority is when the customer or prospect does not have responsibility for making the buying decision. It is usually a "buying committee" that has the final say.
The next time you buy a house or car watch carefully how the sales person will remove this roadblock. The sales person will say, “If we find the house (or car) that you really like, is there any reason you could not make the purchase today?” Once they get the green light, the sales person will spend whatever time it takes to find you the right product. If you say your husband or wife has to give the final approval, the sales person will try and set up an appointment when both of you can be present.
To avoid being the victim of the higher authority, be sure all parties necessary to make an agreement when you are making your presentation. For example, if one of the buyers is not present, it is best to postpone the meeting until everyone can be there. If one of the critical parties is not there, that person can veto everything that was agreed upon.
If you are the one making the presentation and the presence of someone important is impossible, set a short one or two day time limit for his or her higher authority approval.
You can use this same strategy. You can start your presentation with the same question. "If I show you a program that will not only save you money on your operating expenses, but also lower your labor cost as well as increase your sales, is there any reason why you would not want to give it the go-ahead?" If the buyer has to get approval from a higher authority you will know how to tailor your presentation.
If you are making a presentation to a person who does not have authority to make the decision, the best strategy is to build up the person you are presenting. Suggest to the person that the committee is surely influenced by what he or she says. If you can get them to commit to making a "sale" to the committee, it can be embarrassing if he or she is not able to get it through for you.
Another strategy if you are selling to a buyer who has to "run it by the committee" is to ask about the possibility of making a presentation to the committee yourself. This can either call their bluff or it may present you with an opportunity to actually make a presentation to the buying committee.
When making YOUR presentation it is to your advantage to present a higher authority from which you must get approval. Even if you do have complete authority over the selling price, you may want the buyer to believe you have to get approval.
If both buyer and seller could say to the other, 'I know what I am doing and I have the power to make the best deal possible’ it seems as though the selling process would be much easier. This is not always the case. When you have the authority to make the final decision the buyer knows that he or she only has to convince you and does not have to work quite as hard if you are the final authority. Once you have given your okay, the sale is done.
Not so with the person who has to answer to a higher authority. When you have to have approval from your department manager, sales manager, purchasing manager, marketing manager, or even the president of the company, then the customer must do much more than convince you, he or she must present a reason you can take to your higher authority for approval.
This is only a tool you should be aware of and use when the situation calls for it. There are many times that it is not necessary and you can be the final authority without any problem.