BY Jessica Helinski
Just like with other relationships, red flags in sales exist. Even in the sales world, these signs of trouble can give warning about a less-than-ideal situation. But sellers may not be aware of these red flags. Or, they don’t think they’re that big of a deal.
But these two issues underscore a big challenge for reps.
Why should you care about red flags in sales?
Every seller hopes that a deal will go through. They spend time and effort into making it happen and don’t want that to go to waste. But not every deal is worth pursuing. And, in the long run, sellers may waste more time if it’s not a good fit.
Every deal can feel like a potential turning point,” writes Benjamin Laker for Inc.
“The right partnership, contract or investment could propel your business forward—but the wrong one can drag you down.”
The challenge lies in knowing when to walk away. This is why it’s important sellers recognize, and react to, red flags.
The numbers just won’t work
If a deal doesn’t make financial sense, it isn’t worth doing. No amount of hope will fix bad numbers. A pricing structure that hurts your profits or payment terms that hurt your cash flow can damage your business.
And keep in mind that small concessions can grow into big problems over time.
As Laker points out, “The real danger comes when you convince yourself that ‘things will balance out.’ They rarely do.”
He shares some common ways that sellers may be undermining themselves when it comes to financials:
- Unfavorable payment terms: Long payment delays may hurt cash flow.
- Thin or negative margins: Very low or negative profits can make the deal unsustainable.
- Hidden costs: Variable costs can subtly reduce profits over time.
Moving goalposts
Another major red flag in sales is when a prospect keeps moving the goalposts, i.e., changing terms or other details.
Requests, of course, are acceptable but only within reason. If pushing back dates, delaying decisions or making new demands become a habit, that’s a red flag.
It’s clear that there is an issue that needs to be addressed. Is it urgency related? Does the buyer not clearly see the value of your solution? Whatever the case, working with an unreliable buyer can be bad for business.
“… time to take control of the situation,” advises Paul Petrone.
Either firmly move things along by discovering the root of their actions or walk away.
Something feels "off" or uncomfortable
Red flags in sales can be tough to identify, especially if it’s a “gut” feeling you have. Sellers should be conscious of their instincts. While it’s easy to wave them off, pause before doing so.
“Sometimes, everything looks fine on paper—but something doesn’t feel right,” Laker writes.
“That’s your intuition trying to warn you.”
Ongoing doubts suggest something is wrong. Vague answers can hide important problems. A bad history often means issues will happen again. Trust your feelings anytime something seems not right.
And the same goes for any discomfort you may feel with the buyer. As SalesFuel shared, sellers should always prioritize their own comfort.
“No deal is ever worth working with someone who makes you uncomfortable, whether it’s due to disrespectful behavior or lack of emotional control.”
Step back to keep control
Admittedly, it’s not easy to stop pursuing a sale. But it’s important to remember that a bad fit ultimately does damage that is costly in so many ways.
Laker points out that walking away is a power move; it’s a way for reps to stay in control and protect their business. Watching out for red flags in sales will ultimately free up time and energy to pursue prospects that will pay off in the long run.
Photo by Markus Spiske on Unsplash
