Your capability to transition from price-sensitive supplier to valued strategic partner rests with a newly sophisticated group of professionals: the procurement chief.
The sales profession has a lot to answer for. Over the past two decades, many salespeople have relaxed into an over-reliance on flashy presentation software, whether that’s PowerPoint, Canva, Pitch, or any number of modern deck-building tools, and what amounts to little more than a product features dump dressed up in attractive slides.
“With salespeople using presentation tools for everything, it drew the sales profession into the presentation business at the very time that the marketplace was increasingly uninterested in presentations,” says Tom Snyder, CEO and Chairman of Business Performance Partners.
Today, the fact remains that no amount of carefully selected fonts, animated transitions, and novelty bullet points will get you past any procurement department worth its salt. Procurement has traditionally been seen as the major roadblock to selling into a client organisation, and that’s not about to change. As the function continues to evolve and become increasingly sophisticated, trotting out your standard slide deck is the fastest way to being shown the door.
“The rise of procurement as a blocker between the sales apparatus and a customer buying organisation is a real thing,” explains Jonathan Dietrich, Senior Director at Corporate Executive Board. “It has to do with the low level of business acumen across many sales organisations, a lack of understanding of how customers make money and the economics of their business. So it just isn’t the natural expectation of procurement to think of a sales organisation as having something extra to add to the process.”
If the essential function of procurement is to compare competing sellers, then it is up to the sales professional to demonstrate value that outstrips cost and thus maintain differentiation from competing sellers.
“These procurement departments are an army embraced by the world’s major corporations. Part of the procurement person’s role is to drive price down,” says Snyder. “They are singularly focused on the price that will be paid. Now that’s a different issue to the cost that will be incurred, but they’re generally rewarded for driving invoice price down, and they do that by trying to make all competitors look identical.”
And it’s not always bad news for the seller. “If you stop and think about it, not every single sale made in B2B is made with the cheapest offer. Plenty of companies are very successful while being some of the higher-priced offerings in their marketplace.”
In markets with fewer large players, the challenge is different again. “Procurement people often have the mindset of ‘We know what the options are, and our job is to pit them against each other’,” adds Spencer Wixom, Senior Engagement Manager at Sales Executive Council Solutions. “That’s where the procurement function can be most dangerous, because it has a desire to compare apples to apples. If you’re a sales organisation that wants to win in today’s environment, you really need to be thinking about how to sell an orange, how to get key decision-makers to understand the concept of differentiation. Procurement knocks down that differentiation and tries to find common components among a select group of vendors.”
Inside Procurement
No sales professional wants to get involved in a race to the bottom on price. However, today’s enlightened procurement managers are interested in much more than cost reduction.
According to Craig Rooney, Group Procurement Manager at Porter Davis Homes, salespeople who view procurement people as the enemy, or as an extension of the finance department, do so at their own peril.
“Procurement is not just about getting the right price, it’s about partnering with the right supply chain; with the right surety of supply and quality,” he says. “So it has gone from raising a purchase order to actually knowing what it is we buy, knowing it complies, knowing how to measure it, and making sure from a supplier performance management point of view that over the tenure of the contract it continues to deliver what was promised.
“To that end, the measures for procurement are not all around savings but are more around value creation, innovation, point of difference, and total cost of ownership. Procurement is looking for mutually beneficial partnerships.”
However, as Rooney notes, this evolution is uneven across industries: “There certainly is still that old ‘price is all I care about’ mentality, but there’s a growing and accelerating trend towards people making value decisions instead of price decisions.”
The key for sales professionals, says Snyder, is to recognise the changes that have taken place within the procurement function, work alongside it, and commit to evolving with it instead of working against it.
“If you go back 30 or 40 years, the general pedigree of a person put into procurement was someone who processed purchase orders and not much more. But when supply chain management became a sophisticated science in its own right, encompassing data analytics, ESG compliance, supplier risk management, and strategic sourcing, those people exploded in terms of their significance within the organisation. Unfortunately, the sales profession didn’t adjust to that, so we were left a little bit behind.”
Powerful Partners
As a senior procurement professional, Rooney is consistently surprised by the poor selling behaviours salespeople display in day-to-day dealings. Cardinal among the sins, he says, is a lack of understanding of his organisation’s basic strategies, all too obvious in salespeople who come in under-prepared.
“If a salesperson sits in front of me and doesn’t comprehend what our business needs are, and therefore what value creation looks like for me, then they’re going to cop the stone wall,” he explains. “If you don’t understand my business, how can you possibly deliver me a value proposition? It translates to a lack of respect.” That’s a poor foundation for partnership building.
The solution, argues Rooney, involves a complete mind shift about how the sales function is run.
“I’m always surprised at the high turnover in sales, and the short-term thinking. If I’ve got this week’s or this month’s budget to meet and if I don’t meet it I’m out on my ear, what’s my inclination to go and actually research who this client is and what they need for future viability and sustainability? You’re making as many calls as you can on the basis that one in 20 will turn into a sale. That’s not going to generate partnership.”
Genuine opportunities exist right now for sales organisations to transition from price-sensitive vendors to valued strategic partners. In a business environment shaped by post-pandemic budget scrutiny, rising input costs, and heightened focus on supply chain resilience, procurement teams are under more pressure than ever to justify their decisions, and that opens the door for sellers who can speak to value with credibility.
“It’s an atmosphere in which you can get better,” says Snyder, “as opposed to the reactive, short-term selling that economic pressure tends to produce in less disciplined organisations.”
Not only is the current environment ripe for this kind of differentiation, but mutually beneficial partnerships between buying and selling organisations are the tonic for growth and stability in constantly changing markets.
“As a procurement person, I always get internal stakeholders to articulate what’s important to them, and invariably it starts with price,” says Rooney. “But dig deeper, and it’s rarely just price. For example, right now in the building industry, if a supplier can reduce our build cycle time or help us manage energy and logistics costs more predictably, that gives us a cash flow and planning benefit that’s genuinely attractive. Understanding what’s important to our business enables us to work out the non-price criteria we want to evaluate. So what sales wants is also what procurement wants. We’ve got a common goal.”
Pathway to Partnership
Having a common end goal is one thing, but negotiating the pathway to achieving it is quite another. As well as understanding the evolving role procurement plays in the buying cycle, successful sales professionals must be capable of identifying the stakeholders whose buy-in is essential to the strength of any potential buyer-seller partnership.
“High-performing salespeople understand which stakeholders will mobilise on behalf of the sales organisation, versus average performers who focus on a different set of stakeholders who will not advance a deal,” explains Dietrich. “So what is the difference? How do high performers identify them, and how do they actually engage them?”
Snyder goes further, arguing that if you find yourself selling to procurement, you’ve already missed the boat. Sales professionals need to move upstream and secure executive buy-in before the deal ever reaches procurement.
“You don’t sell to procurement. You sell to the stakeholders who will ultimately enjoy the functional benefit, the efficiency, the additional productivity, and the economic benefit inside the organisation. By the time it’s on the desk of the procurement officer, the sale is all but made. There may be negotiation and there may be an arm-wrestling match on price, but we’ve made the sale upstream.”
Dietrich agrees: “Good salespeople understand that while the procurement challenge is one of the biggest they’ll face, there are other stakeholders within the organisation where consensus needs to be built first.”
“There is an answer: be a professional seller,” adds Snyder. “They have to be an engine of value creation long before the deal hits procurement. The dialogue is not about how great your product is. It starts with what the customer organisation wants to fix, accomplish, or avoid. The salesperson’s dialogue can then shift to an ‘if/then’ proposition: ‘If that’s your problem, then this sort of outcome would appear to be of value.’ Then, and only then, do you connect your product or service to that vision, so that by the time this thing is ready to go to procurement, that selling is 85 per cent finished. If we’re not helping the client discover something about themselves, we’re a dinosaur.”
The Procurement Process
A look inside the evolving procurement process, with insights from Craig Rooney, Group Procurement Manager at Porter Davis Homes.
Research “We certainly do a lot of market research and a lot of internal understanding of exactly what it is we buy.” Procurement professionals spend far more time and resources assessing potential suppliers than most salespeople assume.
Engage Internal Stakeholders “We engage our internal stakeholders, go out to our businesses and ask: ‘How is the incumbent performing?’, ‘Is the specification right?’, ‘Is the business criteria right?’, ‘Do we need to modify that?'”
Cover All Bases “Today, we’re looking at a much broader range of options, domestic and international, traditional and emerging. Supply chain disruptions in recent years have made it clear that diversification and resilience matter as much as price.” Don’t assume you’re up against the same competitors every time.
Evaluate and Match to Need “We look at the market from the point of view of market capacity versus our demand, and try to identify the right supplier mix. The role of procurement is to be objective, analytical, and independent, and not fall in love with one solution.”
