Cancel That Cancellation

What separates a sales pro from a novice? The ability to save a cancelled order. No one ever said it was easy. And it’s not done by magic, either. It requires sound judgment, clear thinking, good analytical skills and tactful aggressiveness. Finally, you also have to stand up for your rights as a professional who knows the value of your time.

After you learn a customer has canceled an order, what do you do first? Do you have the authority to offer the buyer a better price or special deal? If so, what limitations exist? At what point if any should supervisors or executives intercede on your behalf? Specifically, what do you want them to say or do? This should all be spelled out in writing so that guesswork is eliminated.

“The first thing that should be done is to make sure your company has provided a clear written policy in regard to cancellation,” advises Jeff Greene, president of Stevens Point, Wisconsin-based Gamber Johnson Corp., an industry leader in the development of mounting systems and mobile docking stations for public safety, utility and other markets.

“Company policy should reflect management philosophy and consider conditions that may have a significant impact on the cost of cancellation,” Greene adds. “For example, company policy might be quite different for a custom manufacturer than for a distributor who stocks commonplace products.”

Of course, asking the reason for cancellation is an obvious must. “A common reason for cancellation,” says Robert E. Levinson of Lynn University in Boca Raton, FL, “is that someone else in the prospect’s organization said no.” Levinson works as both a marketing executive and a sales representative for the fast-growing university. One of his major responsibilities is to attract donor funding for the institution’s expanding needs. But, he points out, it makes no difference whether a canceled sale involves a bequest or a manufactured product – discovering why an order was canceled may require some clever detective work.

Understandably, a buyer who backs out on a commitment is reluctant to explain why. But you deserve an explanation. In fact, the more time and effort you devoted to competing for the order – sales interviews, presentations, product demos, etc., not to mention lunches or dinners at your expense – the more entitled you are to a clear and honest explanation.

“The people who placed the order will probably be embarrassed and reluctant to talk about it,” Levinson admits. “Their secretary or assistant, not sharing their embarrassment, probably will feel less restrained about talking.”

Consequently, developing friendships and relationships with lower-level personnel is always a good strategy with future as well as current transactions in mind, Levinson urges. Treating a secretary to lunch, for example, can open doors that were double-locked in the past.

Once salespeople find someone who will explain the situation, the primary goal is to address the customers’ rationale for their actions. Was it their actual intent to close the door? Or are the buyers playing games? Digging down to the buyers’ true motivation will challenge any salesperson’s questioning skills. Sometimes customers threaten cancellation as a kind of litmus test to determine whether they can get a better deal. Or it may be a matter of simply clearing up a misunderstanding. Perhaps the customer had a bad experience with someone in your organization and is still unhappy about it.

“Finding out the real reason can be difficult,” says Greene. Customers’ needs change. So do circumstances. “If a defined need existed when the customer placed the order,” he adds, “then either the need has been fulfilled by a competitor or the need has changed. Whatever the case, it’s important to understand the true rationale.”

Why? Knowledge is power. If it’s possible to reverse the buyer’s decision, knowing the rationale will serve as a base from which to launch whatever strategy you plan to use to put the sale on the right track again.

What are a rep’s odds of persuading prospects or customers to change their minds a second time and fulfill their original commitment? Not good, in most cases. But if the sale is important enough – and if the need still exists and the salespeople are convinced they can satisfy that need to the customers’ advantage – it will be well worth the effort.

Sometimes, however, all the persistence in the world can’t change the buyer’s mind. “Whatever the case,” Levinson says, “cancellation offers an opportunity to build a solid base with the customer. Depending on the size of the order, it’s important to meet with the most senior person available. Discuss the cancellation; possibly delete any charge that exists. Prove to the customer that this is no more than a small blip in your relationship. Seize the opportunity to grow rapport with future business in mind. Turn a bad situation into something positive.”