Closing Deals (Winning and Losing)

Key Insight

Securing a win means acting swiftly post-verbal agreement to execute the contract, preventing second thoughts. The order form is a critical tool, concisely memorializing agreed terms for signature, distinct from a comprehensive proposal. It should facilitate easy, friction-free execution. While a Master Service Agreement (MSA) with legal terms is essential, it should be linked separately rather than appended to the order form, avoiding unnecessary complexity for typical purchasers. Standard MSAs from legal counsel or templates are recommended, provided as a Word document or PDF if a sophisticated buyer's legal or procurement department requests review.

Redlining, where a purchaser's legal team modifies contract terms, can introduce delays and incur legal fees, potentially consuming a significant portion of the contract's value (e.g., $300 per hour for corporate counsel). Strategies include asserting the company's standard contract or carefully reviewing changes. Selling to mid-market companies often simplifies this, as they typically lack the resources for extensive legal review. E-signing solutions are indispensable for reducing friction and expediting signatures, eliminating manual printing and scanning, and signed contracts must be immediately stored in the CRM linked to the opportunity.

Beyond contract signing, ensuring payment is crucial, as many startups neglect collections. Facilitating easy payment options, such as e-payment services like PayPal for early stages (a 3% fee on a $10000 contract can be justified by avoiding collection costs and risks), is vital for early-stage companies where upfront cash flow is key. Additionally, a seamless transition to customer success is essential, involving scheduling kickoff calls or training, and introducing new customers to their dedicated success contact. Capturing key information—names, titles, and contact details of decision-makers, executive sponsors, and product users—at closing facilitates future success reporting and relationship management. Losing deals is inevitable; if winning all deals, the pipeline is likely too small or too selective. Win rates of 10-20% are typical, 30% is excellent. Reasons for loss include budget constraints, shifting priorities, or personnel changes. It is better to 'close lost' quickly than to waste time on unlikely deals. Close lost when a prospect directly declines or consistently goes dark. Maintain a 'mindset of plenty,' not scarcity, and address stalling situations directly with a respectful email that seeks clarity and keeps the door open for future engagement, documenting the reason for loss in the CRM to inform product roadmap and aid future resurrection of the opportunity.