ROI Justification for Frugal Buyers
More buyers are having difficulty getting purchases approved, with 47% delaying a purchase because of uncertainty, and C-level signoffs now required on purchases of $50,000 or more. 
In order to get to “Yes”, sellers need to financially justify proposals to frugal executives and risk averse approval committees. This is a vital practice, as 95% of buyers now require formal ROI justification to garner approval and 2/3rds of prospects indicate they don’t have the metrics, models, and resources needed to justify on their own.
Buyers are relying on you, the seller, to financially justify proposed solutions. After all, if you want to make the sale, you’ll provide the ROI proof points. Examining your opportunities, are you proactively providing financial justification, or are you leaving financial justification to chance?
It is no wonder that less than ½ of forecasted deals actually close, and 21% of pipelines stall at “do nothing”, much attributed to lack of financial justification and approval delays.
Financial justification must be proactively delivered along with the proposal and pricing on any significant opportunity.
ROI justification should include:
- An overview of business priorities and challenges that the proposed solution is targeting.
- A tally of the “do nothing” costs, the losses by not addressing these challenges and remaining with the status quo.
- A quantification of the business value benefits anticipated including cost savings, productivity / process improvements, risk reduction, and business growth.
- A tally of required investments to implement, deliver, and support the proposed solution.
- Quantification of key financial metrics including discounted cash flow, payback and ROI analysis.
- Evidence that similar organizations have achieved proposed benefits, and that the assumptions and ROI are conservative.
