The one sales killer question -- "What is Your Budget?"


If there is one sales issue that stumps most individuals responsible for new business, it is the prospect who presents an ill defined problem and has little or no budget. But how does the salesperson expose the lack of budget before expending the energy and expense of preparing a complex proposal?

In a recent newsletter issue published by, contributing editor Jill Konrath wrote an interesting article entitled The One Question that Can Kill Any Sales Conversation that addresses this very point.

She relates a story of a salesperson who piqued her interest to the point that she agreed to proceed with the project only to have the salesperson kill the sale with the budget question.

 "...I also need to get my blog social-media friendly. I don't have anyone working on that right now. It's a small project, but a necessary one. Interested?

Of course, she was. She asked, 'What's your budget for this?'

That's exactly what traditional sales training tells you to ask. To find out if you're dealing with a qualified buyer, you're supposed make sure they have money in their budget for your service.

It was the wrong question to ask!"

Why is qualifying the prospect for budget so important?

As with any resource, sales people have limited time and money to do their jobs. And one way to guarantee missed sales goals is to waste those limited resources on unqualified prospects who have neither the money nor the authority to sign off on the proposed project.

The prospect, on the other hand, has no idea what the solution costs and wants to know this to see if is is even feasible.

For most high level sales executives, prospect budgets must be determined before preparing a proposal that takes many hours and often significant expense to prepare.

In many cases, the available budget -- or at least a gross range budget range -- will make the problem unsolvable based on the sales person's experience. Why waste the prospect's time or the salesperson's time when no sale is possible?

The client wants the specifications for the solution to his broad (and usually poorly defined) problem without investing in the skills and time to prepare it. And the service provider needs confirmation of the prospect's ability and willingness to pay before investing in the development of the proposal.

As a consultant, I have no problem discussing HOW I would approach the project and allocate time/costs for each step. But I cannot lay out the specifications for solving the problem without charging for my time.

To a greater or lesser degree, some companies will let you know what it costs to solve a well defined problem. But if the prospect has an itch with no idea how to solve it, then he must pay for help in defining both the problem and again for developing potential solutions. Implementation costs are then possible once the specifications are developed.

So the question remains. How can the prospect and the service provider come to terms on this issue? How can sales people qualify the prospect without spending too much time educating them when they will never buy?

More to the point, do you agree with Jill Konrath's article when she says the budget question before the solution is presented kills the sale?

Posted on July 2, 2010 and filed under Consulting, New Business.