No salesperson should ever be afraid of objections. Learning how to overcome objections, like the “no budget” argument, should be at the heart of your sales skills toolkit.
Savvy salespeople know that a large chunk of their prospects won’t ever become paid customers. That’s just the ‘biz.
But by the time a prospect says, “I have no budget,” top salespeople know what to do. They know the meaning behind a “no budget” objection differs for every client.
Having completed hundreds of successful sales calls, they have learned not to take the objection literally and focus on the actual cause behind the objection—i.e., lack of trust, lack of perceived value, or simply that the prospect isn’t the right decision-maker.
Read on to discover how expert sales professionals deal with these common objections and how you can improve your approach.
Overcoming the “no budget” objection: 9 sales experts weigh in
To figure out how to handle the “I have no budget” objection, we asked nine leading sales professionals to share their best tips and tactics.
Neutralize the “no budget” objection
First, acknowledge that you understand what the prospect has said and recognize its validity. Then, tell them, “I understand. A few of my customers have gone through their budget quickly this year and are trying to get approval for an additional budget.”
The pros call that initial statement a neutralizing statement. Then you can immediately follow up with a high-impact question such as: “What is your annual budgeting process?” or “How do you determine which initiatives get priority for funding?”
These questions validate that the prospect’s statement is recognized and understood. However, when you respond with a statement that seemingly agrees with the objection they just made, they are likely to detect that you actually empathize with their goals, which allows you to turn an objection into an opportunity to ask a powerful question that will get you additional information. They may even share with you what it takes to get additional funding.
The info you get from the questions can help you undo the objection. At a minimum, you can ask additional questions, which allows you to continue to guide the conversation forward.
I recommend getting into the pricing and budget discussion at the start of the initial qualification call. This way, you can get ahead of any pricing objections that might come after the prospect sees the value of the product or service you’re selling.
There will always going to be companies (like startups and small businesses) with firm budget-related objections, but it’s usually easier to identify these early in the sales process if pricing and budget are discussed first.
Once the objection comes up, it’s best to show how your service can solve their problems and prove value/ROI before leaning on a discount to overcome it.
You can provide references from current customers in the same industry or any customer who might have a similar use case and show how your service has helped them.
If your product or service is priced similarly to or below most of your competitors, you should have an analysis available to show that. If cost is the main objection, you can always offer a short-term discount or even a free month of usage to help get them over the finish line and see the value your service provides before they fully commit.
In Enterprise sales, the objection is typically attributed to missing the following qualification criteria.
Pain: Throughout the sales cycle, you should actively quantify pain and seek to understand the consequences of staying in the status quo. If you don’t quantify pain in your customers’ KPIs—such as lost productivity, time to revenue, and cost savings—you should, because you can use it as an opportunity to go deeper and ensure your solution is tied to your prospect’s largest business objectives and problems.
Economic buyer: Confirm you are working at the appropriate altitude within the organization and that your buyer is a decision-maker. Ensure you have not mistaken a champion as the final decision-maker. If you are not directly working with an economic buyer, prioritize working with your champion to secure a direct conversation. Once you secure access to the decision-maker, confirm their objectives and initiatives and seek to understand their level of sponsorship of your solution.
Budget: Last year, many organizations had low financial performance due to the pandemic, negatively impacting their cash flow. If this is the case, brainstorm with your prospect various ways to address the issue, whether it is creative payment terms or reducing products and services.
There’s one thing you should not do. You should not say, “Show me the money,” like Jerry McGuire. That will not get you a demo. When I get the objection, I address their concern about the budget while taking out the monetary part and focusing on making them understand my product’s value. I clarify that the purpose of the first demo is to educate them on the product’s value.
Once I jump on a call, I thank them for being upfront with me. Then, I acknowledge they don’t have the budget. But then I say, “I see a lot of people allocate their resources for something they see as valuable. And just based on your website and my research, it looks like you guys would be a great fit for our platform.”
Find their problem’s financial cost and offer something cheaper than their current solution
To me, this question all comes down to doing proper discovery early in the process. I need to understand exactly how much of a problem they have and what it’s costing them. To get there, I ask questions like:
Sounds like this is an issue for you. Do you think it’s actually costing you money?
Is it just a minor annoyance that you need to put up with?
What’s your best estimate of how much it costs you?
Does anyone else know about this?
If it turns out it’s costing them money, I ask them: “what do you think would be a reasonable budget to solve that problem for you?”
If they come back and tell me they have no budget, I refer back to the earlier discussion and say, “I’m not in a position to tell you how to spend your money, but if I had a problem that was costing me X and someone was offering me a solution that costs far less than that, it would seem reasonable to me to figure out a way to find the budget, am I missing something here?”
If you have a reasonable prospect they typically will follow your logic and agree with you. If not, typically you’re either talking to the wrong person (i.e., not the budget holder), or you’re talking to someone that’s unreasonable.
Focus on how your solution helps the prospect save time or money or make them money
People don’t mind buying things; they just don’t like being sold. People’s first reaction when we’re trying to sell them anything is typically to pose some objection. One of the things that I like to do is determine if it’s really an objection or just a reflex.
People want to make money, save money on expenditures, and save time. So if someone throws an objection, one of the first things that I’ll do is say “What if my product could save you time, money, or help make you money?”
I prefer to pivot the conversation or refocus on something that I can help them with. Most people can’t resist that response because everybody wants to save time and money or make money.
You can sometimes bring up one of the prospect’s competitors and try to prove that they are using your product or service and that they are finding great success with it. Using stories really helps to sell.
Finally, I like using an objection cheat sheet. “I really respect that you don’t have a budget right now, but what I’d love to do is give you the information so that when you do have the budget, you won’t have to research. You’re already going to have all this information in front of you.”
You’re just trying to keep them in the loop. And most people are pretty cool with that.
I also prefer to establish next-steps before getting off the call. Since they might not open a follow-up email, try to give them some information immediately or set up a demo while I’ve still got their attention and consideration.
Prospects are far more likely to buy when they’ve heard of you before. This step-by-step outbound campaign template shows you how to get on your contacts’ radars before you start dialing.
Focus on answering a question, adding value, and asking a question to steer the prospect in the direction of thinking about how we can optimize their business practices.
For example, you could say: “I totally get it—most companies I talk to work on tight budgets. However, the reason why companies switch to us is to increase revenue, and often on the first call, we can determine what the ROI would be. What are your thoughts on scheduling a 30-minute call to see if this is worth adding to the list of software to evaluate for 2021?”
Be sure that you’ve established the cost of their challenges before asking for a budget. How much is it costing them right now for not actually solving those challenges?
Then, tell your prospect “In order to solve the problems that you said costs you, for example, around a million dollars, what could you see investing in this project?”
If there’s still no interest, it’s time to pull out the range. The range sounds something like this, “In order to accomplish what we discussed, I can tell you that we’re going to be somewhere between a hundred thousand and $400,000. Where on that range, could you see yourself investing now?”
What’s amazing is that once you throw out some numbers, they are very likely to share with you a specific number.
Finally, don’t leave until you have established a budget. You have a right as a salesperson to get on the same page with money before you put together a proposal. The key is to be totally committed to agreeing on a budget before you go to the proposal.
To discover what “no budget” really means, stop talking
When someone says, “I don’t have enough budget,” it can mean a lot of things. But simply “neutralizing” the objection doesn’t make the objection go away. What I do instead is elaborate to unearth the underlying meaning of the “no budget” objection.
Client: “We have no budget.” Me: “No budget?”
And then I shut up. The client always elaborates. “Yes, we can only spend X on these projects because they fall under department Y.”
Then I know what the problem is. After that, it’s all about figuring a way forward.
Me: “So this project will only affect this department?”
If they say yes, I go into detail and try to get them to see the big picture, and eventually get a meeting with someone else from another department so we can unlock more money.
If they say no, we skip the “get them to see the big picture” part.
One size does not fit all and quite often the situation can be a lot more complicated. But a good rule of thumb is that you never make it worse by listening.
Beat the “no budget” objection with these example sales scripts
Sometimes, it’s helpful to have a few sales script examples on hand as a guide for navigating tricking objections. The following three script examples demonstrate potential conversations you could have with your prospect or lead when the “no money” objection arises.
Explore budget flexibility and priority script example
Use this script example to determine the extent of your prospect’s budget constraints and figure out how your solution can align with those while supporting their company goals.
Salesperson: “I completely understand—budget limitations can be challenging, and I’ve had a few other clients in similar positions who are also working to manage their budgets closely. Some even ended up securing additional budget approval to support key initiatives that could have a high ROI.”
Prospect: “Yes, we’re tight on budget this year.”
Salesperson: “That makes sense. If I may ask, how do you usually determine which projects receive funding priority? We might be able to identify ways our solution could align with those high-priority areas.”
Salesperson follow-up based on response: “That’s very insightful. It sounds like maximizing impact within budget constraints is crucial for you. If it’s helpful, I’d be glad to discuss options that could provide flexibility, such as phased payments or reduced services tailored to your immediate needs, to help fit within your current budget.”
Understand the current problem’s cost script example
Implement a sales script similar to this to find out the cost implications of the prospect’s current problem and open the door to discuss how your solution could save them money, improving their bottom line.
Salesperson: “I appreciate your transparency about the budget constraints. Many companies are in similar situations right now, especially in areas like yours where optimizing costs is a top priority.”
Prospect: “Yes, we don’t have much flexibility on new expenditures.”
Salesperson: “Absolutely. If I may ask, though, what impact do these issues have on your operations or revenue? Sometimes, quantifying that cost helps clarify whether it makes sense to find a budget allocation. For example, if your current challenge costs your business $10,000 a year, and a solution like ours could solve it for less, the investment could actually improve your bottom line.”
Salesperson follow-up based on response: “Thank you for sharing. I’d love to explore solutions that could align with your company’s needs and goals while staying within a reasonable range of investment. Would you be interested in scheduling a 20-minute call to look at options tailored to your available budget?”
Build value and maintain the relationship script example
Consider the following script example if you reach an impasse due to the prospect’s current budget constraints but want to build a rapport in the hopes they will opt for your solution when the budget is available.
Salesperson: “I hear you. Budget limitations can be restrictive, and I’ve had similar conversations with others this year. Perhaps it would help if I demonstrated how our solution could help you maximize your existing resources and achieve a faster ROI.”
Prospect: “I’m still not sure it’s possible to fit this in right now.”
Salesperson: “Completely understandable. What if we use this time to evaluate your challenges and potential ROI so you’ll have everything ready if the budget opens up? I’d be happy to send over materials or do a quick demo to show how the solution could pay for itself over time. Does that sound like something that would be beneficial?”
Salesperson follow-up based on response: “Great! This way, you’ll be fully equipped to make a decision when the timing is right. Shall we set up a quick 15-minute demo to go over those specifics?”
Make overcoming objections your sales superpower
With these sales expert tips and script examples, you should be well on your way to handling prospect objections related to money and budget constraints.
No matter the situation, always remember that your first priority is providing your prospect with a solution. Approach every sales conversation with the objective of solving a problem and building trust rather than making the sale.
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