I have been purchasing several appreciative and depreciative assets for my company and I have never let my partner to undertake it. Until now it has been very successful and most of the time we do not have to pay the 10% or 20% deposits prior to the approval of our financial facility from the bank. This includes the vessels that we have had, the stocks that we own, and a few others.
It has been quite sometimes for me to undertake these tasks of asset purchase until last week I then decided to have a trial; by requesting my friend/partner to undertake the final negotiation with the land owne. It is about the price of the land and payments methods that I had requested him to do. This particular land is in Terengganu.
The land is RM1.1 million; 9 acres of Palm Oil Plantation and it is along the road side. There is an income contributed by the Palm Oil Plant and I personally realize this is a golden opportunity and I always believe in leveraging theory (the bank).There is only one single approval left from the owner owner; discounts; between RM700 – RM900 thousand.
In my early discussion with the owner, he has agreed for discounts and payment is only after the banking approval/drawdown. At this end satge, I hand over to my partner for further negotiations since I have done almost 85% of the jo. After all I am busy with banking negotiations too.
I reminded him that "this is an asset buying, BUT remember this involve selloing and hence 'Principles of Selling' MUST not being forgotten.
My friend called the owner end of last week and surprisingly the answers trun to be negative. The owner refuse to sell the land and of course no discounts if he still wants to dispose. I was surprised and asked my friend why? What had gone wrong? Despite of looking in buying the land, my friend has forgotten on the principle of selling. He told me that; he had told the land owner; the price that we could purchase is only RM700 thousand and the payment must be after the drawdown from the bank.
What is actually happened, is he had probably misses the principle of selling during the discussions. The owner indeed knew that we are buying his land for investment – to make an income. He agreed with me for on the buying and selling methodology I had proposed. But why does it fail with my friend?
I strongly believe that my friend doesn’t know the 'selling part' – selling of IDEAS. He only approach the owner as a land buyer and the scenario is totally different. That is why he fails and I need to renegotiate again myself.
What do you think about this in your perspective with regards to selling principles?
It has been quite sometimes for me to undertake these tasks of asset purchase until last week I then decided to have a trial; by requesting my friend/partner to undertake the final negotiation with the land owne. It is about the price of the land and payments methods that I had requested him to do. This particular land is in Terengganu.
The land is RM1.1 million; 9 acres of Palm Oil Plantation and it is along the road side. There is an income contributed by the Palm Oil Plant and I personally realize this is a golden opportunity and I always believe in leveraging theory (the bank).There is only one single approval left from the owner owner; discounts; between RM700 – RM900 thousand.
In my early discussion with the owner, he has agreed for discounts and payment is only after the banking approval/drawdown. At this end satge, I hand over to my partner for further negotiations since I have done almost 85% of the jo. After all I am busy with banking negotiations too.
I reminded him that "this is an asset buying, BUT remember this involve selloing and hence 'Principles of Selling' MUST not being forgotten.
My friend called the owner end of last week and surprisingly the answers trun to be negative. The owner refuse to sell the land and of course no discounts if he still wants to dispose. I was surprised and asked my friend why? What had gone wrong? Despite of looking in buying the land, my friend has forgotten on the principle of selling. He told me that; he had told the land owner; the price that we could purchase is only RM700 thousand and the payment must be after the drawdown from the bank.
What is actually happened, is he had probably misses the principle of selling during the discussions. The owner indeed knew that we are buying his land for investment – to make an income. He agreed with me for on the buying and selling methodology I had proposed. But why does it fail with my friend?
I strongly believe that my friend doesn’t know the 'selling part' – selling of IDEAS. He only approach the owner as a land buyer and the scenario is totally different. That is why he fails and I need to renegotiate again myself.
What do you think about this in your perspective with regards to selling principles?
What type of selling that he has to do? Is it the 'new' consultative selling or just relationship selling?
4 comments:
Hi Zul,
This is the first time ever that I send a comment for a blog. Well I'm trying to give you my thoughts on the question that you had posted. In my first opinion, you had built a relationship with the seller and I think that your friend doesn't exactly know the whole picture of your past dealing with the seller. It is you who had the relationship and not your friend. Maybe the seller doesn't feel comfortable in dealing with your friend. Looking it further, the seller do understand that you are trying to make money with the land since you had mention that the purchase is for investment purpose. You did mention that you are expecting discount on purchasing the property. If your friend had made a little research on the actual market price of oil palm land, I think that will also make a lot of difference. I made a few phone calls and surfing the web, the average asking market price for oil palm land in Terengganu is roughly around RM30,000 (+/-) for an acre, and of course depending on a lot more factors. That means, you can get more discount then you expected. One more thing, that your friend had done is that he didn't further discuss with the seller on what the seller wants and needs, and by just offering the lowest offer must had offended the seller on his own perception. Basically, I think that it will be in the category of relationship selling.
Please correct me if I'm wrong and hoping that we can discuss it further in the coming class sir.
Abdul Rahim Ismail
PDSM 13-01
DJ 07 class
Dear Rahim,
Good. Your comments is good and I appreciate that. Relationship selling is right but more accurate is the consultative selling. I did use the consultative selling very well by explaining to the seller what I wany to do with the land and how much is the amount of benefits that he would get from the selling of land to me and my friend.
There must be a value added items to make him agreeing on my terms and hence it would contribute such a win-win situation.
Zulkulfi Zakaria
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I think at this stage the seller realized on the demand and started to value their properties..:D Obviously great discounts been considered and that’s where prompt deed have to be made instead change off the PIC..As you said, “golden opportunity”..Definitely “combination” of “consultative and relationship” selling method would be superb but I think the seller wasn’t listen to understand and they revalue buyer expertise especially when you changed the PIC to continue the negotiation which I believed he/she probably has no idea on what the negotiation was between the seller and you....
Well..not easy to break the gold......anyway, good luck sir :)
Siti
USM 114
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