The Budget Objection is Crap

April 5, 2017 John Barrows

We’ve all heard these phrases way too often: “we don’t have any budget” or “budgets are fixed.” They’re similar to the “it’s not you it’s me” line which, unfortunately, I also heard too often in my earlier years. That said, all of them are crap.

Most purchases companies make throughout the year are not budgeted. There’s a bucket of money that gets allocated to specific solutions, but those solutions usually aren’t actual line items in the budget. I had a CFO tell me once that a budget is ultimately a best guesstimate on how much money a company needs to spend to hit their guesstimated revenue targets. It’s a guideline to prevent against misuse of funds, but is also fluid and changes with priorities.

Here’s a phrase that proves budgets aren’t fixed: “priorities have changed.” Have you ever heard that one? When we hear that, it usually means we are dealing with someone lower on the totem pole and someone above them came and took our money. It can also mean that someone internally or externally did a better job selling the value of their solution over ours.

What they’re really saying when they say they don’t have budget is that we haven’t justified our solution’s value enough. We haven’t made them consider shifting budget from one area to the other. It usually isn’t a one-to-one comparison, either. Our solution could be less expensive or better than their current one, but those value points are outweighed by the cost of change and/or time to make the transition.

People below the power line are more likely to use the budget objection. They don’t want to take the risk or invest the time, regardless of how obvious the one-to-one comparison is to their current solution. This is why it’s so critical to get as high as we can within organizations and find true Champions.

The two main characteristics of true Champions are 1) they can steal budget and 2) they agree to be our Champion. We need to find people who will not only help us sell internally but who actually have influence on the final decision and can stand up and fight for us when the time comes. We also can’t assume anyone is our Champion based on a few good conversations. We need to be direct and ask them. At a certain stage of the sales process, I ask: “Will you be my Champion?” or “Will you fight for me when the time comes?” There are two answers to that question: 1) yes! and 2) anything other than that. If they hesitate then you know you don’t have a true Champion and you have more work to do.

Once we identify who could be our true Champion, we need to figure out a way to justify the value of our solutions and to get on the priority list. A lot of this has to do with creating a sense of urgency by selling to priorities.

At the end of the day, budget objections will always be a part of our Sales world. Instead of looking it as an impossible roadblock, look at it as a challenge and an opportunity to show real value. Make it happen!

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