Dennis Collins:
Welcome to another episode of Connect and Convert, the Sales Accelerator podcast where small business owners just like you learn insider tips on how to grow your sales faster than ever. I’m Dennis Collins, and as always, she keeps coming back. Thank you for coming back, Leah. My partner. Say hello, Leah Bumphrey.

Leah Bumphrey:
I can’t help myself, Dennis. Good to see you. I know Paul’s out there somewhere, too, eh, Paul?

Dennis Collins:
Producer Paul is in the background today, but you never know. Here’s the fun part of this podcast. You never know when producer Paul’s going to chime in. You just don’t know. So stay tuned, because it happens when you least expect it. It’s always good stuff, isn’t it, Leah?

Leah Bumphrey:
Absolutely.

Dennis Collins:
Today, we have an interesting topic. This sounds a little technical, so bear with me for a second. The common law of business balance. What the heck is that? I’m going to ask Leah a question to start with, so maybe we’ll get into this with a question.

Let’s say that I’m offering you a product or a service, and you can only have it good, fast, or cheap. You can only pick two. It can be good, high quality, quick, fast, or inexpensive, cheap. Which two do you pick?

Leah Bumphrey:
Oh, Dennis, this one always gets me, because we want it all. We want to think that we can have all of it.

Dennis Collins:
We do.

Leah Bumphrey:
To have to pick two out of the three, it’s so dependent on what it is that you’re talking about. You know me. I always like to take it away from what we’re talking about, the specifics of business. Business is real life, but in our real life, when we’re trying to figure things out, like doing a renovation on a home, or what kind of food we’re going to be eating, you can’t have it both ways.

If I’m having cheap food, it’s not necessarily the best quality. If I’m having the best quality, I’m not maybe going to be able to afford that all the time. All these things come into play. It’s a balance, as you said.

Dennis Collins:
Well, again, you know me. I do the science on this stuff. Sorry, guys. I know I’m a nerd.

Leah Bumphrey:
Don’t apologize. We love it, Dennis.

Dennis Collins:
This is called the Project Management Triangle. It was originally created back in the 1950s, and was called the Iron Triangle, or sometimes it was called the Triple Constraint. It was designed to help project managers, people that were designing systems and projects, to see the relationship between the three aspects of the project.

Obviously, the time, the cost, and the quality, the scope. But what they learned, there are trade-offs. Do you prioritize quality, speed, or cost? You can only have two, Leah. Did you know that? You can only have two.

Leah Bumphrey:
It was the wacky ’50s.

Dennis Collins:
That comes back from the 1950s. That’s before you were around, but trust me, I know a little bit about the 1950s.

So what are the trade-offs? If you want high quality and fast service, I’ve got to have something really top quality, but I need it fast. What’s going to happen? It’s not going to be cheap. How about if you need it fast and inexpensive?

If you don’t have a budget, but you got to have it fast, be ready for a quality problem. And if you want high quality at a low price, yeah, you might be able to get that, but it’s not going to be fast. It’s going to take longer. So the project managers use this to design their projects. Which two would they design? I think it shows that we’re in a world of trade-offs. We’re in a world of compromises. I mean, I don’t know about you, Leah. In my career, I have never, ever been associated with anything that was low cost. Every product or service that I have represented or that I’ve consulted or I’ve coached has been high cost. How about you? Are you in that same boat?

Leah Bumphrey:
You know, actually, yeah. When I look back on all the companies that I’ve worked for and been associated with, even clients, you know, the clients that you pick that you really want to work with, high quality has always been important to me.

Dennis Collins:
The high quality and therefore higher cost. I’ve never relied on low prices to make a sale. That’s never been in my playbook. I’ve never, “Hey, can I make you a deal? Hey, what would it take today?” You know, all those cheesy things.

I just don’t do that. It’s kind of against my DNA. I don’t know why it just, you know, I believe that what I represent is a high quality situation, a service or a product, and therefore it’s going to cost you more. But it doesn’t all get down to value at some point? And that creates its own kind of set of issues. Where does value reside, Leah? Where’s the home of value? Where do we find the home of value?

Leah Bumphrey:
Value, again, is very personal. Where you end up attributing it, like somebody might think of a vehicle, you know, is it the speed of the vehicle that you’re after? Is it the German engineering? Is it the fact that it’s made in North America and that’s really important to you?

We put value on these intangibles because it’s important to us intrinsically. It gets us right in our heart. And from there comes all those decision-making. What are you willing to pay for it? How long are you willing to wait for it? Why do you put value on these things? I always am fascinated by that in business.

Dennis Collins:
As am I. I mean, value, as you correctly pointed out, resides in the mind of the buyer. It’s personal. You said the key word. First one, the first thing you said in your answer, it’s personal. And yet sometimes in sales and marketing, we think there’s some kind of a universal idea of value.

We propose that when we do sales pitches, instead of sales conversations, we are assuming that everybody values the same thing that we value. And because we have come up with a list of features and benefits and all those things that we need to have, that everybody buys into that. That’s just not the way it goes. If you’re at the top of your price range, everything you do must reflect that premium position. Everything you do, everything you say, every piece of collateral material, everything online, every ad, whether TV, radio, whatever type of ad, everything has to reflect that position.

That’s not easy, Leah. Have you noticed that?

Leah Bumphrey:
Well, it’s not easy, and you also can’t apologize for your price. There’s a reason for it. You’re setting the stage. You don’t want to get into a position where you’re feeling defensive about the price. If you are representing the top of your game, the top of your industry, there’s no apology.

Not everyone’s going to be your customer because they’re not prioritizing the same things. But as soon as you start backtracking on that, then people get suspicious. Dennis, how come you’re charging me this much?

Dennis Collins:
As you know, and I’ve told our viewers and listeners a million times, you’re probably getting tired of hearing it. I listen to a lot of recordings of sales calls. I mean, a lot. I can tell you by just the tone of the voice of the salesperson whether that customer is going to buy because there are words that they use. There are phrases that they use. There is language that’s less than confident. We’ve done some podcast episodes on that. What is confident language? I hear mitigating language that is not certain, language that is not confident. I can tell you with almost 100% assurance, I don’t even know how the call came out. I can tell the call that would win and the call that would lose because they’re projecting… I can’t see their body language, but their voice is uncertain. They’re not backing their pricing. They’re apologizing for it. It’s obvious it can be smelled a mile away by a customer.

The language that we use, the way we talk about what we do, is of great importance. I came across, when I was a new kid in the sales business—luckily, I had some wise older mentors who were way smarter than I was—and they were talking to me about price and value because, again, I was selling high-priced products and I was having trouble extracting the value.

I was having trouble getting the buyer’s mind in tune with the value. He shared a quote that I still use to this very day. It’s attributed to a guy named John Ruskin. He was a 19th-century British art critic, social thinker, writer, pretty smart guy. I can find no direct evidence linking this quote to Ruskin, but it does clearly reflect what his views were on the false economy of always opting out for the lowest price. He had a huge preference for high-quality goods. Let me give you the quote. It goes something like this.

“It’s unwise to pay too much, but it’s worse to pay too little. When you pay too much, you lose a little money. That’s all. When you pay too little, you sometimes lose everything because the thing you bought was incapable of doing the thing it was bought to do.”

Wow. What do you think about that?

Leah Bumphrey:
It’s true. It’s absolutely true. If you’ve ever been in a gunfight with somebody who is selling the same product at a lower price, what are they trying to say? It’s the same thing as the higher price. That is their argument. Why would you pay more for the same thing?

Just sheer logic tells us that’s impossible. We go back to the beginning of our conversation. It can’t be.

Dennis Collins:
That’s right. You can only have two of those three things. Clearly, this, to me, answers a lot of the value questions. If you pay too little, you sometimes lose everything. As we’ve done a lot of episodes on the laws of influence, the fear of loss, fear of missing out, loss aversion is more motivating than any gain.

“If you pay too little, you need to have a fear that you may lose everything because the thing doesn’t do what it was bought to do.” There’s more to this quote. The common law of business balance prohibits paying a little and getting a lot. It just can’t be done. “If you deal with the lowest bidder, if that’s where you deal, it might be well to add something for the risk you run. If you do that, you will have enough to pay for something better.”

Wow. Ruskin apparently didn’t write that, but whoever did, that’s pretty profound, isn’t it?

Leah Bumphrey:
Absolutely, because it makes perfect sense and it passes the smell test on us. That makes sense to me.

Dennis Collins:
But yet, in our selling and our marketing, sometimes we’re reluctant to bring this concept up. Why not, though? The salespeople that I coach, I encourage them to use this. What do you think, Leah? You’re very familiar with sales, sales training, and coaching.

Would you coach salespeople to use this concept? Not necessarily exactly as we talked about it, but in some way, shape, or form?

Leah Bumphrey:
Beyond a doubt. I always like to remember when I’m talking to, particularly new salespeople, but run to the mouth of the lion. If you are the most expensive product, embrace it. This is something to be proud of. This is something to own. You mentioned some of the recordings that you listen to where it’s kind of hesitant and, oh, everyone’s a little bit nervous about the fact that, yes, I’m just that little bit more.

No, this is something to be excited about. I am this because of this. There’s a great, I don’t know what you call it, a GIF or a picture that was floating around the internet a little while ago. It was a big, beautiful truck that was hauling a boat. They had come off. They were doing a curve, maybe around Pike’s Peak or something. I don’t know why you carry a boat up there. The boat was falling down, was off the edge. The truck’s hanging on, and the guy’s looking at it, and, yeah, I bet you wish you would have paid a little bit more for that hitch, or this is when you’re glad you paid that little bit extra for the hitch instead of going for the cheap one.

Those are those instances where you go, hey, thank goodness I paid more. Thank goodness I’m selling something that I can trust for my client.

Dennis Collins:
Let’s have a cheer for quality, for value. Absolutely. That’s the winner. If you go with the lowest bidder, you better add a little more, as Mr. Ruskin says, because you’re going to need it.

You might as well pay it up front and buy something better. My challenge today to our viewers, our listeners, what stories do you tell yourself and your team members about your value? If you’re not telling them this kind of story, why not? What trade-offs do you make?

What trade-offs, when you manufacture a product or a service, what trade-offs are you willing to make with your products or services?

Leah Bumphrey:
I would also emphasize, along with that, Dennis, how do you communicate which of those three you are to your clients? Is it with confidence? Are you able to say, we are the cheapest and the fastest? Is that where you’re hanging your hat? Then own it. We are the most expensive and the best? Just embrace that, but don’t apologize for who you are.

Dennis Collins:
Perfectly said. Do we have any questions this week from any listeners or viewers? Sometimes we don’t.

Leah Bumphrey:
Yes, we did. Dennis, I thought this was an interesting one. We always are inundated with what’s going on in the world. It doesn’t matter if someone is listening to this 10 years from now or if they were listening to us talk about this topic 10 years ago.

Our listener wanted to know our opinion on how much time do you spend when you’re in business and you’re focused on your industry and focused on what you’re doing, how much time should you spend knowing what’s going on in the world around you?

Dennis Collins:
Boy, that could be a whole series of podcasts, couldn’t it?

Leah Bumphrey:
I agree.

Dennis Collins:
How much time? I have two views of that. One is, by immersing yourself too much in the minutia of what’s going on around you, you lose focus. But to be totally oblivious, I guess the answer would be, let me put a filter in that filters in the stuff that I need to know.

My guess is a huge percentage of what’s going on out there I don’t need to know. I just don’t need to know. Just because the media says it’s important or highlights it or headlines it or spotlights it, does that mean it’s important? No. That means it’s important to them.

It’s important to them to build ratings, which build revenue, profit, et cetera. The bottom line is, I have found myself, Leah, systematically over the past few years, weeding out things that I don’t need to know. Things that don’t enhance what I am trying to accomplish in my life and in my business.

I think that’s a very interesting question. My answer would be, select the stuff that keeps you on focus that you need to know and disregard the rest.

Leah Bumphrey:
Fantastic. That is excellent advice. You always put a good pin in it, Dennis.

Dennis Collins:
I guess. At least that’s my spin on it. I thank you for the listener who proposed that question. Again, we’ve got to stop right now. I’m having so much fun with this, but time is up. We respect the time of our viewers and listeners. This is Dennis and Leah saying so long for this episode of Connect and Convert.

We’ll see you next time.

Leah Bumphrey:
Absolutely. Love it.

Dennis Collins:
We’ll talk to you soon.

Leah Bumphrey:
Bye-bye.

Dennis Collins:
Bye-bye.

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