Artfully Scientific Closing
by Tod Snodgrass
“Nothing happens until a sale is made (closed).”
–Thomas Watson Sr. (Founder, IBM Corp.)
Closing sales is usually described as more art than science. If it was the latter, then you could expect the exact same outcome every time you apply the same sales techniques to a particular selling situation. However, anyone who possesses even a modicum of knowledge about the process knows darn well that the outcome of any particular sales meeting is anything but totally predictable. The variables are too many to count, starting with the fact that we are dealing with human beings each of whom brings many different agendas, opinions and life experiences to the table.
This doesn’t mean that sales is totally lacking when it comes to applying well-known techniques and tried and true approaches in order to turn a lead into a sale. What most sales pros will tell you is that a lead is one thing, a closed sale can be quite another. So, if closing sales—or in this case—getting properties under contract is the goal, then it stands to reason that a combination of art and science needs to be applied in order to maximize potential outcomes.
Door to Door Learning Curve
I learned about sales and selling early on in my life. At the tender age of 13 I went to work for a company that sold magazine subscriptions. Essentially we knocked on doors, doing cold calling; LOTS of cold calling. Sometimes a hundred doors or more in one day—with 95 of them slammed in my face. It was tough sledding. Ninety percent of new sales recruits the company hired bombed out in the first few days. And in fact I did not sell anything until the third day. But once I got the hang of it, I was off to the races. Wound up setting sales records and making a lot of money for my age, at the time.
Here are some of the things I learned then that pretty much still apply today, all these many decades later.
1. Know your stuff. Included in that catchall phrase is knowing pretty much in advance what you are going to say, but then adapting it to the unique person and circumstances staring at you across the table. For instance, when I was 13, we were required to memorize a canned pitch. It was slightly hokey, but it worked. The company had hired a psychological testing company who experimented with all sorts of different sayings, phrases, etc. What they came up with was actually pretty good. We of course could add our own spins to the memorized spiel, but only at the margins.
Lesson learned: Plan your work, work your plan. Write out in advance of your meeting what you need to say and how you are going to achieve same. Go over potential objections. Know in advance how much you are prepared to bid, under what terms, in what time frame. Have an agreement ready to go in order to make the sale.
2. Get it in writing. Harkening back again to my door to door learning experiences, in addition to knowing what to say, we were also schooled in how to put pen to paper in order to convert a verbal OK into something in writing. Example: We were given index-card-sized “sales cards” to use with potential buyers. As the conversation progressed, we would find out what magazines they liked and check them off on the card. Then we would ask for and write down their name. What we were employing then, is what they now refer to as “assumptive closing”. As long as the buyer did not object, we just kept writing down more and more info such as their address, phone number, etc. Finally, we would hand them the pen and card (that had an “X” where they were supposed to sign). Then we were told to just shut up. The vast majority of the time the buyer would sign the card because it was just part of the natural progression of events that make up the sales process.
Lesson learned: Once the customer signed the sales card, in THEIR mind, they were committed. When the manager/closer came by later that day to get the actual sales contract signed, very few buyers changed their minds. They were locked in once they signed the sales card. Same thing goes with getting properties under contract. It can be done on the back of an envelope, or on a Letter of Intent or Memo of Understanding etc. Doesn’t really matter what form it takes, because the important point is that you need to get it in writing. Once they have signed say the LOI, they are usually very committed to the deal.
3. Different closes for changing circumstances
a. Minor point closing: This technique calls for you to ask a series of questions for which you know you are bound to get “yes” answers. Finally, when you get to the point of them signing the LOI, it is just one more in a long series of small incremental steps that culminates in you walking out of their home with a signed contract in hand.
b. Avoid questions that result in Yes or No answers. Instead, dwell on details that help move the deal along in a linear fashion—from first hello to last goodbye. For instance: Which day would you like escrow to open? How many days of contingency do you feel comfortable with? What items were you planning on taking from the home that are currently fixtures, but could be moved and that are important to you?
c. Door knob close. If the sales call does not go as planned, and you are faced with a do-or-die decision about how to save the sale, try to have lined up in your mind some new concession you can make as a last- gasp-effort to save the currently-DOA deal—but only if they sign on the dotted line right now. It might be a higher offering price, faster time frame, more cash up front, etc. These are called door knob closes because you save them until you literally have your hand on the door knob ready to leave their home with no sale. Then you turn around and make one last final appeal to save the deal with something you have saved up that makes them want to reconsider their previous negative decision.
The bottom line is that sales is not rocket science, but is does have some science in it. It is not pure art either, because there are predictable elements to it. It is, at the end of the day, really a combination of the two = artfully scientific. Your job is to take the best elements of both art and science, and create a vehicle that works best for you.
[Editor’s Note: this article is a reprint from and email newsletter I was signed up for by Tod Snodgrass, a San Diego real estate professional who helps people buy-and-hold or buy-and-flip properties. He can be reached by email at firstname.lastname@example.org.]