Fashion House Chooses a CRM Database
Mac met Levi, a design student, at Uni. Mac was into software programming. Levi, a tall man with a commanding presence, was CEO of a national fashion business with many high profile stores. Mac had pale blue eyes and loved to help people. He owned a software company bidding for the Sales Management CRM database at Levi's company and was shortlisted. Jackson was Mac's competitor. He had ginger hair, an abrasive personality and owned the other shortlisted CRM business. He had a "win at all costs" attitude revealing to Levi that Mac was an undischarged bankrupt, not fit to be operating his database business.
Mac was invited to lunch, up at Levi's fashion business to discuss the allegation. He felt upset that someone would lie to discredit him. At lunch Mac asked Levi to consider due diligence on the shortlisted suppliers because it would negate Jackson's allegation and Levi agreed.
Mac asked Levi what he wanted in the CRM. He explained the fashion industry's shift to online shopping and promotions had to be managed better. Levi wanted reports on the promotions sent to each customer. He wanted the right message to the right customer at the right time. Mac's proposal included a prototype, links to accounting, websites, courier services and an option to replace the accounting system.
Mac asked what the outcome would be and Levi wanted a better customer experience with 14 day deliveries cut to a couple of days which will increase turnover by $1 million per week, summarised by Mac as $52 million annually.
Next day Jackson called Levi offering $3,000 discount and pushed Levi to get a same day response from his competitor Mac. Because Jackson only did CRM, Mac decided to bring his accounting system into play so he offered a $3,000 discount off the new accounting system and no discount on the CRM. With Mac on the phone Levi shouted down the hallway to see if his CFO liked Mac's accounting system. He loved it, so it was now on the table for negotiation. Mac smiled.
Jackson called Levi the following day and heard that Mac had not been kicked off the CRM shortlist, he became angry and accused Mac of cheating and lying. Levi had a room full of designers in a meeting and told him to focus on his own bid and hung up on him. Jackson was outraged and would end this ridiculous negotiation with a small fish CRM competitor. He called Levi again at 6:00 pm with a special offer. It's a discount of $30,000.
Levi asked how he could discount so much and Jackson bragged that his software company was much larger than his competitors. Levi was concerned about Jackson loading $30,000 surplus in the CRM quote, but he denied it. Levi firmly told business owner Jackson that he would have known the costings and if he had placed an order on Jackson's original, undiscounted bid, the $30,000 would have been taken without hesitation. Jackson denied everything but had been caught out. Levi said he had failed to develop a relationship or build trust, both critical in business. Levi had background checked both suppliers. Jackson's reputation was to be aggressive in software sales, but not to deliver after the money changed hands.
Levi invited Mac to the office for drinks and to meet the fashion industry people. He was congratulated for winning both the CRM and the accounting system.
We have to compete fiercely and it seems unlikely that a large discount would not win the sale but Levi wanted the right relationships for the future of his business. If cheap was best, Jackson would win every time. Mac was able to see the client's point of view. This is based on a true story.