BANT: Budgeting Conversation

When it comes to discovery calls, the most popular framework ever discussed is the BANT, originally developed by IBM: Budget, Authority, Need, and Timeline. There are variants to this approach, but it survived the test of time, and it does tackle four important issues that, indeed, should be addressed in the discovery call.

So we are going to review them one by one.

Let’s start with the budgeting conversation. First of all, it’s not the first one you discuss in the discovery call. It comes first just because it makes the acronym sound better. In fact, many say it probably should be the last issue.

Note that most sellers misunderstand this approach, believing that the only focus should be on understanding whether the client has money to purchase the product or service you offer. Technically, if you have pre-qualified the buyers, you should already have reached out to them, knowing whether they have the cash to engage in a sales conversation with you.

The budgeting conversation is a lot about your ability to read the organizational structure. That’s why you need to be strategically skilled. It’s important to understand whether there is an allocated budget or not. Some prospects already have an allocated budget line for the product you offer, while others must request funds or reallocate them from somewhere else inside the organization. If the latter is the case, you need to understand how the budget gets approved and how many layers (finance, procurement, executive) could potentially block the budget allocation effort needed for the product to be purchased. This gives you a very clear idea of the complexity of the sales conversation and of the likelihood of the buyer being qualified or not.

You also need to understand the strategic flexibility of the buyer company. In several good companies, budget is never a constraint. Budget is created every time you can make a compelling business case for the return on its investment. Not every company has this strategic flexibility, though. In some cases, the budget is fixed and planning is not flexible. It shouldn’t be the case. Budget should always be created when you have a compelling reason to justify ROI, but most companies are not mature enough to understand this, and certainly, your efforts will not suffice to change the strategic planning of the company.

Last, the budgeting conversation is about competing priorities. How many other projects or products are fighting for that money? How could your solution rank vis-à-vis alternative uses of the money? How much of that money has already been earmarked for other projects? Here, you need to be a strategy expert too.

So, in sum, the budgeting conversation is really not about asking the prospect if they have the money to purchase the product. It’s about displaying your skills to understand the strategy and the structure of the organization you are dealing with. You need to be a master business professional.

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