Published Work

A ‘Done Deal’ Can Suddenly Become a Dead Deal

You just got off the phone with your top prospect for a large deal. You got the verbal go ahead that you can start next week. High fives all around the office. Done deal. Deal closed. You run to tell everyone. You call your spouse and say that everyone?s going out to dinner tonight to celebrate. You are ecstatic!

Not so fast.

You call the customer the following week so you can get the final contract signed and start on the project. No returned phone calls. This seems like a strange way for a "new client" to act. In subsequent attempts, you have trouble reaching your contact. When you do connect by phone, your contact says "not to worry" and you can get started "soon."

You wait. You call. Weeks. Months. "Soon" never seems to come. The contract remains unsigned. You never start the project. Uh oh. Deal undone. Deal not closed.

I remember a project I worked on a few years back for a merger between two companies. I represented the seller. We had negotiated the deal with the CEO and his outside business advisor. We thought the transaction was done and the companies had set a close date for the transaction. The CEO even visited the company he was buying to welcome all the employees into his company.

Done deal, right? A few weeks later, the deal was called off.

Stephanie Covall-Pinnix, who is now the president of Evolution Partners, says sales can even come undone from your best existing customers. At a previous company, she discusses how they got a verbal "go" from the vice president of marketing and the brand manager.

"The project kick-off meeting was scheduled, the down-payment checks for the project were being cut by the client and our project team was assembled," she said, adding that she was walking around the office on a cushion of air because the deal was set to blow out their quarterly sales objectives.

However, things changed. When she went out to the client site to begin the project and walked in the conference room, the "vice president of marketing was nowhere to be found and the brand manager let us know there was an organizational change a few days before our meeting.

"A dark pall suddenly filled the room. There was now a new executive vice president for the brand manager who wanted to make some "changes" to our proposal. This meant we could not kick off the projects or sign the contracts and those [down-payment] checks were not coming back to the office with us."

However, the brand manager still gave Covall-Pinnix her word that they would begin the following week and set up another meeting at their offices. Still, the morning the next meeting was to take place, the brand manager sent her an e-mail to reschedule.

After another four months of calling and being promised that they were going to start any day now, Covall Pinnix finally took the company out of the "win column." She describes it as a "very painful" loss for her company.

What happened here? Why did the client have a change of heart? How do you ensure the deal closes?

First of all, there are no sure things. It ain't over until it is over. Talk to the Cubs who were five painful outs from the World Series. Many people say the deal isn't done until the customer pays you. Zane Smith, a Chicago attorney, goes further and says the deal isn't done until the customer's check clears.

Ensure you are talking to the decision maker who has the money for the project. Make sure they have control over the budget and they are the final decision maker. No more signoffs needed. Make sure they alone authorize the cutting of the check. Also, make sure you have commitment from any other "influencers" in the decision-making process.

Additionally, when a prospect says you have the deal, it's time to go into high gear. Just like in sports, momentum is big here. It's not just enough to get the football in the red zone near the goal line. Redouble your efforts. Get the contract signed right away and get started.

Follow up all the way to the end. Assume nothing. You can get cut out at any stage of a deal. There are many times some other "trusted agent" interferes between you and your customer. You can be left sitting at the kid's table while this other person steals the decision-maker's ear and gets the project.

Finally, don't think a deal is closed when the customer verbally says "yes." Lisa Pollina of Bordeaux Capital says: "Money signals commitment far more than words or even a signed "services agreement" ever will." As Zane says: "Don't celebrate until the check clears."