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SAVVY SELLING - MAY 6, 2005

When Customers Want Kickbacks

By Michelle Nichols

Sooner or later you will encounter a prospect who demands a bribe. Here's how to refuse -- and still make the sale

At a recent speaking engagement, a member of my audience asked me: What should you say when you give your sales pitch, and the customer responds, "That sounds just wonderful, but what's in it for me personally?"

I'm not naive. I know that kickbacks have existed since the first person traded a cow for two pigs. No matter what you call them -- bribes, consideration, or referral bonuses -- the subject is important because, handled poorly even just once, kickbacks can destroy an individual's career and a company's reputation.

Although less common in the U.S. than elsewhere, graft still exists in one form or another in many industries. I've read of kickbacks with regard to practically every product or service you could think of -- even college textbooks. Like the Visa slogan says, "It's everywhere you want to be."

RECOGNIZE THE COME-ON. In 1998, Sales & Marketing Management did a survey of 200 sales managers with backgrounds ranging from major corporations to privately held companies. Thirty percent said their customers have demanded graft for buying their product or service. The unwritten rules of the game haven't changed much since.

Kickbacks can come disguised in many different ways, including business or charitable reciprocity, extravagant thank-you gifts, and exotic trips. They can sound like, "Gee, I think I could find the budget to buy your widget if you could sponsor a table at my fund-raising event" or "pick up a snazzy golf cart for my new house on the 17th fairway."

Sure, bribes are illegal, and there are thousands of local, state, and federal laws against them. They are also unethical -- witness all the rules of employment and codes of conduct. All the laws, rules, and countless articles regarding kickbacks agree: Do not offer or accept them.

YOUR REPUTATION FIRST. Yet, all this effort still hasn't eliminated payola. So how can you deal with kickback requests and still close the sale? As in overcoming all sales objections, you need to think through your response options beforehand.

Obviously, the fundamental strategic answer to any request for "personal consideration" is a firm "no." Any other possible response could lead you down a slippery slope. Even one instance can poison your professional reputation and possibly cost you your job.

Furthermore, once you give in to a request for graft from one person, word will get around. Soon, everyone will want it. It's nearly impossible to stop this destructive snowball. And caving in to unethical requests also diminishes your self-esteem. You won't respect yourself in the morning, and that lowers your sales capability.

LAUGH IT OFF? To retain your sales momentum, however, you probably need to put a little finesse on your response to such overtures. Make sure they understand your position clearly, yet help them save face so you can continue the sales conversation.

In the best scenario, the customer was just "fishing" for a reward, but remains willing to do straight business with you, too. Maybe someone suggested, "It doesn't hurt to ask." Obviously, if he or she insists upon receiving some personal reward, it may render doing business impossible. But don't give up too soon.

You have several options for initial responses. You can ignore the request, laugh with humorous disbelief, and brush it off. Or, just let the customer talk himself or herself out of it. By confronting the subject with silence -- rather than a direct "no" -- you may make the asker realize that the proposition was a bad idea and should be dropped. Whatever response you choose, try not to sound shocked or angered. Go into meetings forearmed with the assumption that such a request could be made.

ACCENTUATE THE POSITIVE. Your next response, perhaps pointing to a copy of rules of ethics from your company or professional organization, will show that your hands are tied. You may also use a set of written rules from your chamber of commerce or a certification association -- like the one I have from the National Speakers Assn. You may want to print this document out and carry it with you on sales calls.

You might remind the prospective client that your management or professional organization holds you accountable for anything you may offer a prospective client, even something as seemingly trivial as a lunch or golf-tournament registration.

If your customer pushes the point and tells you that all your competitors offer kickbacks, you might want to bring up the subject of business models. Perhaps something like, "Different companies have different business models. I know some companies have kickbacks as a standard part of their business model. However, our business model is more straightforward and, actually, everyone ends up with greater benefit from it." Then, go on to remind him or her of the great benefits of your product or service and the superior overall value.

CRIMES OF COMMISSION. Remember to sell your customer on the power of good referrals. If his or her company's clients finds your offering a great boon, they are going to refer more of their friends. Ultimately, everyone wins more -- and no one ends up in jail.

Customers may call a kickback a "commission," because you may pay commissions to sales agents and other middlemen. Counter by explaining that agents are in a different line of business. These companies bring together business parties for a living, and everyone knows their roles going into a business transaction.

If, in your heart, you feel unsure of whether a customer is indeed asking for a kickback -- or just a win/win business relationship -- imagine how you would feel if tomorrow's newspaper spelled out all the details on the front page. If you would squirm, then follow Nancy Reagan's advice: "Just say no." (For more information on business ethics, you can look into a course on that subject offered by the National Association for Sales Professionals.)

Last, but not least, keep building good connections with your customers. It encourages them to do business with you in the highest legal and ethical manner, so that everyone wins. Happy Selling!

Michelle Nichols is a sales speaker, consultant, and trainer based in Houston, TX. Her columns are available to purchase for reprints or syndication. She welcomes your questions and comments. You can visit her web site at www.savvyselling.com or contact her at michelle.nichols@savvyselling.com. Her direct line is (281) 610-6307 and her toll-free number is (877) 352-9684.

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