Best PracticesOffer value and gain a commercial advantage

August 2, 2022by admin

COMMERCIAL ADVANTAGESAchieving a favourable and profitable outcome

Clients want to believe that you are treating them fairly and providing them with real value in your proposal. You need to propose the best people for the project if you are to win while offering a competitive price. In developing a commercially focussed response – knowing the client and opportunity is vital.

Knowing the client’s ceiling limits for the project, funding requirements, and cashflow capacity all help define and inform the scope of works and optimal commercial model. Do research or keep track of previous proposals submitted to the same client or gain insights from the client directly and keep this information for reference.

TIP: Having validated information in your knowledge library on the key commercial drivers of the client means that you can write a proposal focusing on the client and how to resolve their issues.

Early engagement allows you to model, test and refine your commercial offer. A relationship-based client is most likely to purchase based on trust, value and your ability to solve their issues. They will still expect to see value and differentiation in the offer. A price-driven buyer generally is not concerned with differentiation and has a sophisticated procurement process which drives a commodity-based approach.

TIP: Plan carefully and early to avoid an impulsive response to the current competitor or market trends. In doing so, you limit the pricing war – when no one is a winner. Instead, offer creative solutions that don’t just mimic competitors and the market.

Examples of commercially focussed strategies include:

  • Partnering to offer a holistic or unrivalled capability to neutralise the competition. Have a list of pre-approved partners available.
  • Value adding or volume discounting around scope payment terms.
  • Best for project resource strategy that delivers the best value to your clients and quality revenue to your company. Have a skills matrix mapped to available resources and costs so you can choose the best experts.

Relationships and conversations with your clients are critical to defining and developing a value-based price. Your commercial offer should reflect the client’s price expectation and their perception of value.

TIP: Planning your commercial approach is integral to achieving a favourable and profitable outcome. Pricing should be region-specific – know what the market will bear; consider local taxes, travel expenses and partners.
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