I’m always intrigued to hear about remarkable special pricing offered by some vendors’ sales teams in order to report new business for the current quarter or the current fiscal year.
I think I understand why this happens: the sales team is rewarded for a specific achievement, such as revenue booked or number of new customers; by rushing to complete just one or two new orders, the salesperson might reach a threshhold for a bonus or higher commission tier. And the company itself may want to report the highest possible revenue for the quarter or year, to please investors.
Of course, some customers may recognize these pressures, and delay their orders in the hopes of snagging a better deal, or they may be enticed by an “end of quarter” special to sign with the second-best vendor.
I’m fortunate to work for a privately-held company that doesn’t try to manipulate the timing of revenue recognition, and which doesn’t provide tiers or bonuses that create unreasonable incentives.
[This article is still undergoing revision.]
I tried to find some interesting articles to share on this topic, but came up with just one:
- “Stop the (Periodic) Madness!” by Frank Patrick: http://www.focusedperformance.com/articles/ut22madness.html