How to Close A Business Deal

How to Close A Business Deal

The sales process's final and most critical stage is closing a business deal.

After putting in hours of effort researching prospects, networking, qualifying leads, giving sales presentations, negotiating terms, and crafting proposals, the ability to get the customer's signature and seal the deal ultimately separates top sales professionals from the rest.

This comprehensive guide will walk you through the entire closing process and provide tips on confidently asking for the business, negotiating final terms, overcoming objections, and finalising the agreement to maximise your chances of success.

Mastering these closing skills is essential for anyone looking to excel in sales.

Understanding the Sales Funnel

Before diving into specifics on closing, it's essential to understand where closing fits into the overall sales process known as the sales funnel.

The Three Main Stages

The sales funnel has three overarching stages:

• Top of Funnel (TOFU): Attracting potential leads
• Middle of Funnel (MOFU): Qualifying and nurturing leads
• Bottom of Funnel (BOFU): Closing the sale

Closing occurs at the bottom of the funnel after leads have been nurtured through the first two stages.

Closing Rate Metrics

Two metrics are commonly used related to closing:

• Close Rate: Number of deals closed compared to the number of proposals/presentations given
• Win Rate: Number of deals closed compared to the total number of qualified leads worked

With this context on the sales funnel, let’s examine the closing process itself.

Structuring the Close

The close should be structured into several distinct phases for the highest impact. Preparation is critical.

Four Key Phases

There are four overarching phases to properly closing a complex B2B sale:

1. Set the Stage
2. Make Your Pitch
3. Handle Objections
4. Finalise the Deal

Successfully guiding the prospect through each phase is instrumental in driving the close.

Develop a Game Plan

To maximise effectiveness, develop a customised closing game plan for each deal by asking:

• What is the decision-making process?
• Who are the key decision-makers?
• What factors influence their decision?
• What objections will they raise?
• What terms need negotiation?

Answers will vary deal by deal. Do your research.

Setting the Stage

Proper set-up makes a close much more likely to succeed. There are several critical steps in staging the close.

Confirm the Buyer's Decision Process

Every deal will follow a different decision path. Make sure you understand your contact’s formal process and decision-making authority.

Key questions to ask:

• Who needs to sign off formally?
• What approvals are required?
• Who influences the decision?
• What is the timeline?

Profile All Decision Makers

While you may have one key contact, many people will weigh in on a B2B purchase decision. Gather intel on all key players involved:

• What are their roles? Interests? Concerns?
• What credibility do they have? Who do they report to?
• What is their communication style? Personality?

Build a profile on each person and understand their perspective. This allows you to tailor your messaging and tone correctly with each stakeholder during final discussions.

Confirm the Next Steps in the Process

As you enter the closing stage, confirm where you stand in their process:

• Have all questions been answered?
• Does the proposal address their needs?
• Have they reviewed with other decision-makers?
• What additional information do they need?

Get clear on any open items blocking progress towards a final decision. Having visibility into the remaining steps provides the context needed to guide the close effectively.

Making Your Pitch

When the stage is appropriately set, it’s time to make your final sales pitch and persuasive case for why the prospect should buy from you.

The 10-25-65 Rule

There is an idiom called “The 10-25-65 Rule” describing the ideal ratio for communication:

• 10% Establish Credibility
• 25% Provide New Information
• 65% Emotional Appeal

Effective closes follow this prescribed ratio.

Balance Logical and Emotional Messaging

When pitching, balance rational arguments focused on features and logical benefits with emotional messaging focused on visceral impact and connection. People buy on emotion and backfill with logic.

Know the Value You Provide

Understand exactly what value you provide customers and why people should buy from you over alternatives. Make that value clear when positioning your solution.

Anticipate and Answer Unresolved Questions

After researching the buyer for months and having lengthy discussions, you likely already addressed most of their questions. But anticipate and proactively answer any residual, unresolved questions still lingering in their minds as part of the pitch.

Use Visuals and Trial Offers

Enhance your pitch with visually compelling materials – demos, presentations, and evaluative proof. Layer in free trials or pilot offers to provide hands-on experience. Making things tangible improves close rates.

Handling Objections

No matter how persuasive, expect objections along the path to close. Skilled closers invite objections, acknowledge them, and handle them effectively to alleviate concerns blocking the sale.

Common Types of Objections

There are countless objections raised in closing scenarios, but most fall into one of these categories:

Pricing

• The solution costs too much
• Can you provide discounts?

Competitive Differentiation

• What makes you better than alternatives?
• Why shouldn’t we just go with [Competitor X]?

Implementation Factors

• Concerns about internal resources/bandwidth
• Doubts about ease of integration

Relationship Considerations

• Hesitations about partnerships
• Lack of familiarity/awareness

Risk Factors

• What if it doesn’t work or live up to promises?
• Potential disruption to status quo operations

Best Practices for Addressing Concerns

Here are proven techniques for working through objections:

Acknowledge & Clarify

• Repeat objection back
• Ask clarifying questions
• Use mirroring language

Provide Context

• Share more details
• Correct misinformation

Offer Concessions

• Address with options
• Present compromises
• Focus on mutual value

The goal is to methodically alleviate all concerns raised while keeping the discussion positive and forward-moving.

Finalising the Agreement

Once all objections have been cleared, the focus shifts to finalising terms and sealing the deal.

Negotiate From a Needs-Based Perspective

Apply a need-based approach when negotiating contracts and commercial terms:

For Buyer

• What do they genuinely need to satisfy expectations?
• Where can you provide flexibility?

For Seller

• What elements are non-negotiable?
• What areas can be concession opportunities?

This balanced, win-win approach builds goodwill.

Slow Down to Go Faster

Counterintuitively, deals often stall when sales reps push aggressively to close prematurely before a buyer is truly ready. Exercise patience.

Map Next Steps

Precision matters – define exactly what needs to happen between now and contract signing. Eliminate ambiguity on tasks, owners, and timelines. Don’t assume anything.

Get Signatures!

Finally, don’t forget the obvious. Ask the buyer to sign the contract once the terms have been settled formally! You want binding signatures and a successfully closed deal.

You might also consider using an electronic signature to make the signing process more efficient and secure, ensuring that all parties can easily and quickly finalise the agreement from anywhere.

Closing Best Practices

Beyond the structured closing flow, here are some overarching best practices to incorporate:

Focus on Asking, Not Telling

The most effective closes involve asking the buyer questions rather than doing all the talking with long sales pitches. Ask questions, actively listen, and investigate their answers to uncover motivations.

Always Be Helping

Have a servant’s attitude. Look for ways, big and small, to be additive and helpful vs. transactional with the prospect throughout the sales cycle. This goodwill pays dividends during closing.

Eliminate Surprises

Do not surprise the buyer with unexpected information or requests late in the cycle as you look to close. This destroys trust built over months. Make sure they know well in advance what to expect.

Slow Down Your Speaking Pace

A common mistake is speaking too fast due to nerves during pivotal closing interactions. Consciously slow your speaking pace to improve clarity and let the importance of your message land.

Align with Their Buying Journey

Every buyer follows their unique journey when making a significant decision. Understand where they are in that voyage and meet them there vs. trying to force immediate closure if unprepared.

Additional Negotiation Tactics

Beyond employing a needs-based approach to negotiation, there are additional proven tactics to deploy when finalising the terms of the agreement.

The Power of Silence

Do not fear moments of silence when negotiating prices and contracts. Silence prompts the other party to fill the void, often compromising something they otherwise would not have.

Reference Competitor Pricing

If the buyer counters that competitors offer lower pricing, reference any publicly available pricing you have from competitors to clarify accurate comparisons.

Establish Value First

If the conversation starts directly into pricing too early, redirect the discussion to establishing the value you provide before negotiating the price. Align price to value.

Ask Why They Need Discount

If they ask for discounts or cheaper pricing, ask them to explain their reasoning while you actively listen. Then, provide context from your side on the pricing model and where flexibility exists.

Split the Difference

If unable to agree on a specific term, propose meeting in the middle or splitting the difference to demonstrate good faith compromise towards progress.

Presenting Final Proposal

As contract negotiations wrap up, you must prepare final paperwork and proposals for closing.

Requirements Gathering

Gather any additional technical and operational requirements to finalise the deal's specifics.

Develop Proposals

With requirements completed, develop final proposals, contracts, and Statements of Work (SOWs) for review and approval.

Review Internally First

Before sending final documents to the prospect, have colleagues review them internally to catch any errors and provide input.

Manage Expectations

Set proper expectations on the level of changes possible within the final proposals. Be upfront about what can and cannot shift to avoid 11th-hour upsets.

Use Checklists

Create a closing checklist to ensure you complete all essential tasks before asking for signature and payment. Miss one item and the deal could fall apart unnecessarily right before the finish line.

Asking for Signature

Ultimately, you need the prospect’s signature on the contract to formalise the deal. Asking correctly takes finesse.

Ask with Confidence

When you present the final paperwork, confidently assume the sale is a foregone conclusion vs. timidity.

Refer Back to Original Vision

To reinforce the shared vision, refer back to early conversations on goals for this initiative as you request a signature. This reminds them why you started the engagement.

Pose Clarifying Confirmation Questions

Rather than outright ask, “Do you want to move forward?” pose clarifying confirmation questions instead, such as “Based on our discussions, my understanding is you wanted to commence this initiative by [X date]. Does that timeline still hold?”

Transitioning to Customer Success

Congrats! You closed the deal and now have a new customer. Your work is not done, though – properly transitioning the account to customer success is critical for retention.

Schedule Implementation Kickoff

Get the ball rolling by scheduling the implementation kickoff meeting ASAP. Momentum will stall if the initiative doesn’t launch quickly.

Identify Their Preferred Communication Channels

Ask the new customer their preferred cadence and channels for post-sale check-ins to align your outreach.

Make Clear Introduction Introductions

Warmly connect the new customer to their account manager, onboarding specialist and any other key people they will interact with post-sale.

Develop a Customer Success Plan

Be proactive by creating a forward-looking customer success plan listing all key milestones and metrics you want to track with them rather than just letting the engagement unfold.

Conduct Net Promoter Score Surveys

As part of customer success tracking, conduct regular Net Promoter Score surveys to gauge their satisfaction and likelihood of referral. This provides an early warning system for any issues.

FAQs on Closing a Business Deal

Here are answers to common frequently asked questions around closing business agreements: