I need to hold my key account steady when the client cuts budgets.

I need to hold my key account steady when the client cuts budgets.

When budgets tighten, every line item gets a second look, including yours. The partners who hold steady can show, with evidence from the client's own people, what the partnership is worth.

Five questions to see if your team can do this job today:

1. If your client asked for a 10% price cut tomorrow, does your team already have its answer ready?
2. Can your team show the client what they would lose if you were no longer their partner?
3. Does every business review show how your work helped the client make money, save money or reduce risk?
4. Can your team link each investment you've made in the account, from talent to tools to budget, to a client outcome?
5. Have you shown the client's executives how your contract terms fund the service they receive?

Two or more no's, and the next budget cut may land on you first.

Several years ago, an active customer came to me and asked that I drop our rates by 10%. No RFP. No bid defense. She threatened that if we did not, they would not renew our contract and would suspend use of our service. That meant a $3M reduction in our annual revenue.

The answer I gave her was a polite "no."

The difference between the other vendors and me was that I had prepared to say no to a price decrease a year earlier. I knew how we would respond to any request, as long as we could demonstrate how vital we were to the account's success.

She came into this process with one data point: a 10% drop in price. We came into it with many proof points showing why the partnership was working as is and what would happen if that changed. No threats, just facts supported with evidence from her own people.

In a follow-up meeting, I showed her that the pricing we had in place allowed us to make the investments in service, speed, volume, and quality that created a positive experience for both of us. I also told her I fully expected our competitors to drop their rates, because they were not investing in the relationship the way we were.

In the end, the system we ran kept the relationship from derailing, protected our business and our margins, and helped us become their #1 supplier.

Our system, the Vitality Index, shows your key account teams where they stand today, the work it takes to level up, and how to do it, until they reach a vital partnership that lasts.

What would your key account lose if your team were no longer their partner?

We built a free, 4-minute Key Account Risk Assessment. It gives you a risk score for your key accounts across team alignment, account planning, account transitions, and visibility. Link in the comments.