Very few producers want to walk away from a prospect. As a result, they end up working a prospective client’s bid for an extended period of time only to have it fall apart. The impact of accepting the opportunity to bid or quote a program is a tough battle and a short-term strategy. You may win today’s battle, but lose tomorrow’s long-term war. When you compound the acceptance of the offer with no criteria, you are putting undue strain on yourself, your family, your staff, and your insurance carriers.
To avoid that trap, you must determine the rules of the game. If the prospective client and incumbent agent or broker control the rules, you’re going to lose!
Start by creating a prospect criteria filter that enables you to pre-determine the degree to which the percentages of winning are greater than 50%. Never begin the “heavy lifting” (coverage and claim reviews, employee manual analysis, critique of contracts, leases, policies and procedures, and business continuity planning) until your opportunity for success is determined.
Develop a criteria filter comprised of lights – red (stop), yellow (caution) and green (go). If you get three green lights, you can be off and running - a new client is around the corner. Using the tool, you can be confident in a 90% or better hit ratio. If you encounter a yellow light, proceed with caution and perform due diligence before committing time and resources. If you get a red light, recognize that your time, confidence, reputation, and money are at risk. There are times that you may decide to proceed with a red light. Only do this with the strong belief that you can turn a red light green.
Remember, encountering a red light where your percentage of winning is less than 50% is a fact of life. Be ready to graciously walk away.
How do you know when it’s time to walk away? These nine warning signs indicate it might be time to walk away from a deal:
- When the incumbent’s relationship to the prospect is stronger than you could ever achieve. If the incumbent is related to the prospect or an old school chum, don’t waste any more of your time – you’ll never be able to achieve this level of relationship.
- When you’ve asked for a list of other managers to interview, and the prospect gives you constant excuses, such as, “We haven’t got them gathered yet” or “We’re still considering your risk management audit proposal” or “We’re still thinking about your process.”
- When your key contact no longer responds to your emails or voicemail messages.
- When you are not permitted to speak directly with the ultimate decision-maker.
- When your prospect refuses to commit to any next steps.
- When anyone at the prospect’s business acts or behaves in an unethical manner. Or when you’ve found evidence of legal wrong-doing during the risk management audit.
- When your prospect refuses to engage in a meaningful dialogue early in the sales process and simply demands a quote.
- When your prospect makes it clear that you have to compete “to keep the incumbent honest” in a bidding war.
- When your prospect resists or shows no enthusiasm for your unique risk management process.
Before you invest a significant amount of time with a prospect, review these warning signs. Remember, if your percentage of winning is less than 50% and you walk away, you’ll free up more time to work with other prospects who have a higher likelihood of maturing to fruition.
The key is to recognize the signs and be prepared to cut the ties before you have invested too much.