There was a time when the signing of the deal was the culmination of all the seller's efforts and the logical conclusion of the sale. Today however a surprising number of deals are becoming un-stuck even after an apparent agreement has been reached. That leaves sellers in limbo - waiting for the paperwork to be signed, or the purchase order to be issued. In this whitepaper we look at the reasons why deals get stalled at the last minute and what sellers can do to prevent it.

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Preventing Stalled Deals
Sales Limbo: Are You Still
Waiting For The P.O.?
There was a time when the signing of the deal was the
culmination of all the seller's efforts and the logical
conclusion of the sale.
“Salespeople
are in limbo:
Today however a surprising number of deals are becoming waiting for the
un-stuck even after an apparent agreement has been paperwork to
reached. That leaves sellers in limbo − waiting for the
be signed...”
paperwork to be signed, or the purchase order to be issued.
In this whitepaper we look at the reasons why deals get stalled
at the last minute and what sellers can do to prevent it.

2. The Final Hurdle To The Sale
The paperwork is the final hurdle to be surmounted, but often it is the
buyer rather than the seller that is struggling to jump it. The seller is
looking on from a distance helpless to intervene. Meanwhile
resources (personnel, raw materials, working capital, etc.) may
already have been allocated to the project with costs being incurred
by the seller as a result of the delay.
“...the common
But the challenge may not even end at getting the PO – there can be
delays in getting delivery, or go ahead dates, or even worse in getting
factor is a false
the first, or even the final cheque. The common factor underlying all start of some
of these events is a false start of some kind or other. The seller is in
kind...”
limbo suspended somewhere between the promise and the reality of
the sale.
The 7 Causes Of Sales Limbo
Sales limbo has 7 main causes, as follows:
1. The sponsor(s) fails to convincingly sell the decision. It maybe
a case of last minute cold feet, a lack of confidence, influence,
or commitment on the part of the sponsor(s). Maybe the
sponsor has prematurely moved onto the next challenge
assuming that his, or her work is already done. More
fundamentally the problem may be that the business case, or
justification for the purchase may not be strong enough.
2. A key stakeholder withdraws support or reneges on his/her
commitment.
3. A major internal or external change, the main ones being:
 A merger, consolidation, or takeover
 A market downturn
 A global change in direction
 A manpower change.
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3. 4. Approval/sign-off is not forthcoming either from; the buying
team, from senior management, or from procurement.
5. There is a problem with the legals − a legal question is raised
regarding contract terms, or compliance issues arise.
6. There is a problem between procurement and finance, for
example with terms agreed not meeting finance approval.
7. A ploy by procurement to prepare the ground for another
negotiating round and perhaps the aptly named salami
technique.
But, if these are the main reasons for deals going into limbo, there
are many other underling factors.
Business Case Limbo
The number one reason why deals get stalled is the lack of a
sufficiently compelling business rationale, or business case for the
purchase to go ahead. Either the numbers do not stack up, or there is
a problem in terms of risk, strategic fit, or compliance.
When the purchase decision is scrutinized by senior manager, such as
the CEO, or the CFO, or perhaps even the board, the straight forward
'why are we doing this?' question will be asked. If a compelling
justification is not forthcoming another project or purchase is likely to
take pole position.
The manager who has not tested in advance the business case with its
final audience leaves himself, or herself exposed. To his or her surprise
others may not consider it to be a good decision, or at a minimum
may not have all the information needed in order to give their
support.
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4. The seller's key challenge is to help the buyer to build the business
case. That is a compelling reason to buy and to buy now. That includes
making sure that the cost of any delay is clear (incl. lost revenue, lost
savings, additional costs, etc.).
Procurement Limbo
Internal approval procedures are rigid and uncompromising in many
organizations. If 'all the 't's have not be crossed and the 'i's dotted'
then the decision may be stalled, or de-railed.
In extreme cases there may be a serious violation of internal
standards, or procedures − what is termed 'miss-procurement'. For
example a key step may have being skipped, or some aspect of the
competitive tender process by-passed. In this case the manager will “If procurement
be called to account and the deal will either be delayed, or deferred
while remedial action is taken.
has not been
involved it
In these instances procurement is often out to prove a point in terms may take its
of its stone-walling of the errant buying decision, or non-compliant
manager. The manager is left with 'egg on his/her chin' (so to speak) revenge...”
and may be reluctant to let the salesperson know of the event.
The extent of the violation determines the extent of the re-mediation
required. Perhaps some additional information, documentation or
analysis is required. In the worst case scenario it may be right back to
square one, with for example a re-running of the tender process.
If procurement has not been involved, consulted or engaged at any
point in the buying process, then it may well take its revenge by
stalling at the final hurdle.
The role and power of procurement varies from organization to
organization and with it the degree of flexibility of the rules. In some
cases the response may be 'it is ok this time, but don't do it again', in
other cases it may be much less forgiving in the application of the
rules.
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5. The seller should help the buyer to ensure that procurements needs
are met and to ensure compliance with buying process and
procedures.
Change Limbo
Slow buying decisions that take place over many months. That means
a lot can change in the many months between the start and the finish
of a complex buying decision.
By the time the purchase order is to be signed the context for the
purchase may have changed substantially. Suddenly the buying
organization may realize:
 ‘Our needs have changed...’
 ‘The market has moved on...’
 ‘We have bigger problems to deal with...’
 ‘We need to see what happens next...’
 ‘We are not ready to start yet...’
 ‘There is too much going on at the moment...’
 ‘There is a bigger more strategic decision to be made first...’
Will the buying decision withstand a change in the status quo?
That includes:
 Internal changes in respect of the company's; needs, priorities,
strategies, or
 Changes in its external environment, such as; a rise in interest
rates, a slowing of market demand, the entrant of a new
competitor, a natural disaster, etc.
It is a real challenge for the seller to attempt to insulate the deal from
unanticipated changes. However, ensuring that the buyer has some
room to maneuver is important. That includes an agile approach to
implementation, or delivery, such as providing for the re-evaluation of
needs, amendments to specifications, etc.
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6. Legal Limbo
The manager-buyer may stress the point that signing will be
straightforward, but just wait until legal gets involved. Most buyers
don't like vendor contracts full‐stop; when it comes to signing them, it
is often surprising the issues that arise.
The legal department is very slow to sign any vendor contracts
preferring to write its own. In addition to the delay that results, the
seller may face additional legal costs.
Sellers should anticipate in advance the issues that are likely to arise
attempt to involve legal on both sides earlier.
Where possible, simplify all legal and contractual documentation,
including the use of standard contract terms, templates that have
been approved by professional bodies, etc.
Risky Limbo
Risk can stall a deal like nothing else. That is risk in any of its forms;
business, project, technical, supplier and so on.
Risk is the equivalent of the hand-break in modern buying and has the
potential to slow the buyer to a stop.
Of key importance is the buying organization's sensitivity to risk, as
well as the sophistication of its approach to risk analysis and
management.
Risks have an annoying habit of rising to the surface as the buyer
reaches the point of an irrevocable commitment. The risk was
probably always there, but it either was not fully appreciated, or was
not sufficiently addressed during the buying process. If it had been
addressed earlier it could have been managed and its potential to stall
the decision minimized.
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7. Decision Limbo
The word decision comes from the Latin 'decidere' which literally
means to 'cut off from' − because making a decision means the buyer
cutting him/herself and the buying organization off from alternatives.
The decision to go one route, implies a decision not to go another. If
the chosen solution is not seen by all to be head and shoulders above
the rest then that point of decision may be slowed.
There is often messy stuff involved in many buying decisions, including
conflicting requirements and other complicating factors. In this
context the issue of strategic fit, competing priorities, projects and
past or future decisions is important.
The buyer must be ready to make the tradeoffs required and these
should have been well sign-posted in advance. That means the
competition for the seller is not competing vendor, but an alternative
“Ensure the deal
strategy, technology, or solution. has the backing
of a viable
Political Limbo
sponsor.”
Decisions are not made in a vacuum, but rather in an environment of
competing projects, conflicting interests and organizational politics.
Politics in particular can kill a deal dead. There may be a stakeholder
who feels neglected or threatened, waiting in the long grass ready to
hijack a deal at the last minute.
Managers are slow to correct the seller who overestimates the
manager's power or rank. The challenge for the seller is to align itself
with the key stakeholders and to ensure that the deal has the backing
of a viable sponsor with sufficient power and influence.
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8. How To Prevent A Deal Going Into Limbo?
The seller must guard against deals getting stalled in the first place
and if it is too late re-ignite deals that are already in limbo and get
them back on track. With this in mind here is a checklist to enable you
to measure the risk of a deal going into limbo:
 Is the business case compelling?
 Can it be passionately articulated by the sponsor?
 Is the cost of a delay clear to the buyer (including the
opportunity cost)?
 Are there any unresolved risks eating at the buyer?
 Is there politics involved?
 Is anybody's nose out of joint, does some department or
project feel threatened?
 Is there a competing project?
 Does the sponsor have sufficient power and support?
 Has there been C Level oversight and approval throughout?
 Are all the stakeholders signed up?
 Has the consultation process been extensive enough? Has
anybody been over-looked?
 Has the sponsor followed all the rules?
 Has procurement been involved?
 Are there any information gaps?
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9.  Are there threatened changes in the buying organization or its
industry?
There are implications for selling, including; closing, negotiation and
delivery or implementation.
A summary of the key tips include:
 Assume it will take longer than expected.
 Stand firm. The seller most not appear
panicked to the buyer at any times.
 Update project plans to show the impact
of any delay.
 Make the consequences of delayed start
clear, where possible quantifying the
costs and consequences of a delay for the
buyer.
 Put time limits on your commitment of
time and other resources to the project
ahead of getting the paperwork.
 Explore ways of enabling the buyer to
jump start the project, or to begin with a
pilot or start phase while the hurdles to the full go ahead are
addressed.
 Help the buyer to mitigate the costs and consequences of a
delay (after all a friend in need is a friend indeed).
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10. The Science Behind This Paper
These insights and tools are based on:
1. Buyer Research – our ground-breaking research into how modern
buying decisions are made and the implications for sellers.
2. Best Practice Research – Over 1 million pages of best practice sales
case studies, books and research.
3. Common Practice Research – Our peer comparison benchmark of
1,000s of your competitors and peers.
The Sales Engine® and SellerNav are trademarks of The ASG Group.
The entire contents of this document are copyright of The ASG Group and cannot be
reproduced in any format without written permission.
Want help in tackling your sales challenges? Contact
enquiries@theASGgroup.com
www.theASGgroup.com
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