For the price of tea and biscuits...

There's no doubt that if you are engaged in the business of selling at the moment, there's no avoiding a certain level of frustration at every stage. Even with Winston's aphorism ringing in your ears about success being the ablility to meet failure after failure with repeated effort, it can get pretty difficult to keep positive in the face of mass job carnage, ever-decreasing budgets, decision-makers who can't or won't, and executives who are there at their desks one day and gone the next.

It is a strange new world we are dealing with, folks, and none more so than in the area of budgets. In normal times, the client objection that 'We've got no budget for this' was relatively simple to deal with: it often meant that no one in the company had thought about needing a budget for what you are selling, particularly if you were successful with a true 'creative need development' selling style. There would be a bit of internal haggling, existing budgets would need to be revised or reprioritised and the funds would be found. Even if there was literally no budget for something, it was often the case that in a few months or weeks time, new annual or quarterly budgets would again allow the spending to happen. In any case, good value-based selling could help the client build a compelling internal business case to justify finding some money, if enough concrete ROI could be defined - those were the rules of the game, this was the 'natural way of things' in the world of solution selling.

But no more. It would seem that when a client says to us 'I'm sorry, there's no budget for this' they really do now mean that there is literally zero money anywhere to spend on yours or anybody's offering. Anyway, that's the way it often feels right now, but is it really the case? On the surface, it does seem likely that in these market conditions, the customer has literally run out of money to spend on your service or product, and I have been noticing that the more this objection becomes believable, the more that customers are relishing its new-found power against the evil forces of sales darkness. All of a sudden, salespeople are less inclined to fight back against it, and more likely to retire, hurt. This means we are doing less to test this blanket assertion by customers, and the result is carnage in your sales pipeline.

But I think it is more complicated than that. Have your clients really run out of any money to spend on anything discretionary? If so, they are probably about to go bust. And some will be in that position. So move on, and leave them quietly to their sad fate. But all the others are simply hording cash, operating on a slimmed down P&L model, picking and choosing who they tell about existing budgets, or just being more careful, or more political, about where they make invesments. I've come across several blatant, recent examples of this. I'll give you two of them, at opposite ends of the budget scale, if you like.

One company in the Financial Services sector, one of those actually in the news recently for having been a culprit in the bank credit rating fantasy, says it is unable to spend a paltry £7,000 on a discretionary invesment in its best people, for a professional development initiative. But they are quite happy to press ahead with an £18M refurbishment of a new office block they wish to move to in Docklands this year (despite a 20% reduction in their workforce). Quite incomprehensible, until you consider that it is so much easier to pretend to the purveyor of the £7K service that there is no budget, rather than have to cancel an £18M project. Think of all the senior skin in that game. Think of all the top brass who have had a say in the decisions leading up to that office move, and who would now have to admit they cannot achieve it. Those really massive projects will often avoid the chop, simply because they are too big for the client to contemplate stopping in their tracks. Their hubris and desire to avoid embarrassment will translate into a genuine lack of any funds to spend on much smaller things that may have had more business impact for the short-term. A lack of courage at the top will lead to damage to the business at all levels.

The other example is more generally prevalent, and versions of it apply to practically every company out there. It reveals the importance of the relative value of things companies buy, and the lack of proper rigour in budgetary decision making. I have experienced it first-hand, and unless you are selling the really massive projects, you will too. Quite simply, it is the ludicrous claim made by businesses that 'there's no budget' for something like, say, a long-planned training programme or a marketing campaign - that is, things designed to help the business survive. But there continues to be plenty of budget for other things, that are, shall we say, less obviously business critical. Like tea and biscuits. A company I know, who have just cancelled a small investment in training, continue to spend the equivalent amount every month on biscuits for internal meetings. Or how about £3K a month on finger buffet food. Or £8K per quarter on London taxi rides for all executive levels (there's a recession on, get the bus, do a car-share rota, get the tube, ride a bike). Or £200 a month on newspapers to clutter up reception. Or £3K to have someone come and water the office plants for crying out loud. I realise the people who provide these services are in business too, but the point I am making is that few executives are questioning these 'investments' and making a proper, relative value decision before they throw your discretionary marketing service or training programme out of the window. Because they exist below the radar, a whole range of spend is taken for granted.

If you are in the business of providing services or products that have a genuine return on investment - i.e. real business value for companies right now, you are in a fight for survival and a fight for available budgets. And the bad news is that your clients may regard your sophisticated product or service as less important to it than tea and bloody biscuits.