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How to sell energy efficiency

By Bridget McCrea

Getting customers to look past their checkbooks and invest in energy efficient equipment isn’t always easy

In a world where an increasing number of individuals and companies are preoccupied with saving energy and making environmentally conscious choices, selling energy efficiency to clients is surprisingly difficult. In fact, many companies are so focused on the upfront costs of energy efficient-oriented installations and retrofits that they overlook the long-term value of such investments.

“You really have to initiate a financial discussion first with these projects,” advises Doug Borchers, vice president of sales and marketing at Dickman Supply in Sidney, Ohio. The distributor started selling energy efficient options about four years ago and in 2011 opened a separate green energy solutions division. The good news is the over the last four years the typical customer has awakened to the value of energy efficiency, says Borchers. The bad news is that economic conditions and financial issues frequently stand in the way of the customers’ “green” aspirations.

Cutting to the Chase

To break through barriers that prevent customers from investing in energy efficient options, Borchers suggests a one-on-one discussion with the customer’s CFO, controller, president, general manager, or “whomever is writing the checks for the company.” Electrical distributors who ignore this step and instead work directly with engineers will quickly find their RFPs shot down by the company’s decision makers, says Borchers.

Another good strategy is to create a direct link between energy savings and ROI – a comparison that no CFO can afford to ignore in today’s penny-pinching business environment. Work terms like “payback period” into your energy efficiency upgrade bids and highlight the amount of time it will take for the retrofit’s savings to kick in (especially if the timeframe is impressive).

Be sure to relate those numbers to specific ROI percentages. For example, a project with a three-year payback will deliver a 33% ROI, while one with a four-year timeline will yield a 25% ROI. Such comparisons can go a long way in helping to convince non-engineering types of the value of energy efficient investments.

Borchers says other critical points to cover include the 5- and 10-year cash flow paybacks on the project.  “You really have to sharpen your pencil because this isn’t traditional selling; you can’t just approach the engineering department and show them your latest and greatest whiz-bang product,” he says. “It’s a financial discussion with a decision maker. Initiate it any other way and you’ll just be wasting your time.”

An Educational Approach

Selling energy efficiency also requires an educational approach that the sale of traditional electrical products doesn’t necessarily warrant. The customer that’s been using compact fluorescent light bulbs across all of its locations without incidence for 25 years, for example, will need to be educated on the value of the more expensive, but more energy-efficient and longer lasting, LED bulbs.

During those discussions, Borchers says sales reps should point out not only the energy efficient qualities of the LEDs, but they should also educate the customer about available utility rebates, upcoming product phase-outs, and other activities that could impact their long-standing purchasing patterns.

“Start by getting the customers’ attention with the short paybacks on energy efficiency,” says Borchers, and “then hit them with the other issues that they may have to deal with – or rebates they won’t qualify for – if they don’t upgrade. Cover all of these bases and you’ll have a much better chance of getting them onboard.”

McCrea is a Florida-based writer who covers business, industrial, and educational topics for a variety of magazines and journals. You can reach her at bridgetmc@earthlink.net or visit her website at www.expertghostwriter.net.

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