To make real money on orders you must always stand up for your prices. That means taking the high road and avoiding bidding on orders, making sure that the prices you quote are padded with nice margins. After all, shouldn’t you receive fair compensation for your efforts?

Definition of the word “Bidding”--to offer or propose a specific amount as a price

Bidding began as a way for buyers to make sure that they received a fair return for money spent. Unfortunately, the practice of trying to get a cheaper price for products, goods, or services has changed over the years, especially in the promotional products industry. What started out as a way to insure fair value for products and services has turned into a demeaning process in which the winning bidders feel cheated, and those who don’t succeed feel even worse about their abilities.

Bidding destroys the industry!

If all things were exactly the same, then the process of bidding would be a godsend to all concerned. All too often, there are people who place so little value on their time that they are willing to work on ridiculously slim margins. By doing so, they are asking for trouble at every turn. Since nothing is the same, bidding only does one thing; it breeds mediocrity, and in many instances, failure.

Have prospects ever made statements like these to you?

· We always take three bids.

· I have an order coming up if you want to bid on it.

· Bidding is our company policy.

· You must submit your bid by next week.

If these statements sound familiar, people are telling you that they place little value on your work. Winning a bid, only to gain a low profit margin, is hardly the way to success.

Who are the Bidders?

New salespeople, or ones with low confidence levels, tend to be the most eager to bid. These individuals are fighting over crumbs, limiting themselves to a mediocre living, while making work harder for the rest of us. Perpetuating the belief that the only way to sell is by offering cheaper prices lowers the level of respect and professionalism for everyone else in the promotional products industry.

Read the following story about one distributor’s experience with bidding:
My name is Jack Watson, and I’d like to tell you about my bad experience with bidding process. Two years ago, a friend of mine who worked for a large PR firm in Dallas, called wanting a price on 5000 four-color process T-shirts. He told me that the shirts would be sold during an annual Fourth of July fireworks show. Since it was already the early part of June, I knew we were looking at a rush order.

I felt that my friend was in a bit of a jam, so I dropped my other projects
and checked around for the best price on blank goods. I called my screen printer to see if she could get the order out on time.

Two hours later, I had my ducks in a row and called my friend with a very fair price. When we connected, he told me to put the price in writing and e-mail it to him. I thought the fact that he asked for a written price was only a formality, and I honored his request. At no point in our conversation did he mention that he was taking bids for the shirts. He then promised to call me in a couple of days with a purchase order number.

When he failed to call, I phoned him and he acted somewhat surprised to hear from me. When I asked for a purchase order number for the shirts, he responded, “Jack, I’m sorry but you didn’t get the order. We received three bids that were lower than yours. In fact, your price was the highest of all.” His reply took me by total surprise. Not only did I feel betrayed, but I also felt like my work had no value.

The best way to avoid Bidding!

The easiest way to do so is to create an environment that showcases your abilities, that creates value for yourself. Make it known to prospects that you are different from every other Tom, Dick, and Sally out there. If someone calls you looking for a bid, be honest. Tell them that your specialty is not submitting bids but offering service and reliability those bidders cannot duplicate. Of course, it takes confidence to respond in this way, and you must believe in your ability in order to make such a statement. But for those of you who can, real profits lie ahead in opportunities gained from clients not seeking bids. Big money comes from orders placed by customers looking for quality, not a cheaper price.

Ask smart questions if you MUST Bid!

Many distributors claim that they have to bid on many orders they sell. The lure of a potential government or large corporate contract looks enticing, but is it really worth the low profit margin and aggravation? Don’t confuse the process of providing a firm price with that of bidding. We do give customers firm prices all of the time. We just don’t play the bidding game, and we make it clear that we’re not interested in doing so. In the instances where people insist on asking us for bids, we pose the following questions back to them:

· Are you looking for a cheap price or for the order to be done correctly?

· How many orders have you done with our competitors who are also bidding?

· When will the order need to be delivered?

· When will you pay for the order?

Nine times out of ten, when we ask questions like these, we are able to determine the real reason prospects are asking for a bid. When we know that, we can tailor a response that usually makes it possible to do away with the bidding request. That moves the process toward our strength--service based around quality, not price.

Get serious about your business!

Distributors, who take their business seriously, know that they must maximize profits on orders in today’s world. They realize that the bidding process is nothing more than a way for prospects to turn them away. If you want to be successful, stop spending countless hours filling out arduous bidding proposals. Instead, use that time selling to accounts that understand a fair price means a job well done.