ARE WE OR AREN'T WE IN A RECESSION? Though economists and soothsayers disagree, the answer may be less important than the sales strategy you adopt to deal with customers' perceptions and concerns.

That's because an economic downturn presents dif- fi culties as well as opportunities to technology solution providers. The downside relates to customer attitudes: Buyers can become cautious when their sales are slowing or when the news is bad. If planned projects aren't considered business-critical, they could be canceled or put on hold.

"In tough times, customers think about shoring up their businesses," says Jim Manley, area vice president, VAR Division, Ingram Micro North America. "They do the basic litmus test: Is this a 'must have,' a 'like to have' or a luxury item? Obviously they will favor must-have projects that deliver better business performance. If a solution isn't increasing their sales capability, if it's not creating efficiencies or lowering costs, the PO's not getting signed."

Cautious customers are balanced by the more daring. "Many business executives see a downturn as an opportunity," says Ken Thoreson, CEO of Acumen Management Group, a sales management consultancy. "They understand that if their competitors start to shrink or cut back, they can gain an edge by investing aggressively in technology."

Successful solution providers are implementing sales strategies that are effective in both situations, as we will see from the four profiles that follow.

When caution and cuts are the watchwords, they fall back on trusted relationships to educate customers on the best options. They make the buying process as painless as possible. They push ROI to business executives hoping to gain ground during the downturn. They beef up sales support. They run lean by leveraging distributor services. Above all, they don't panic. Instead, they home in on the business value of their solutions and sell that value relentlessly -- a sound strategy whether times are good or bad.

Mavenspire: Leveraging Trusted Relationships

At Mavenspire, a 10-person solution provider in the Baltimore-Washington, D.C., area, specialties include business continuity, open-source unifi ed communications and highlevel managed services, all linked by a focus on "transformational business technology." Company executives are confi dent in their outlook for the coming months, says Jessica Tanenhaus, senior associate. "We've had our nervous moments, but we're confident because our business model adjusts well to changing conditions."

To what conditions is Mavenspire adjusting? A customer base that has turned very, very cautious. "No one wants to make any changes, and budgets are getting cut,"says Tanenhaus. "People who six to eight months ago were excited about this or that solution are now saying, 'Oh, we've put that off for six months.'"

This has led Mavenspire to focus not on new customers and revenue growth, but on the bottom line -- increasing the profitability of every sale and every customer. Although the company is working to add three to four new customers each month, its main emphasis is on selling more to the existing base by leveraging trusted relationships.

Unified communications provides a good example of the process: Once a customer has part of the solution in place, Tanenhaus can begin discussing the incremental benefits of adding document management, networked storage or managed services. Success hinges on a trusted relationship and the knowledge that comes with it. "We work closely with our customers to understand their business goals," says Tanenhaus. "If we know that they need to improve the efficiency of their overseas operations, for example, we can show them how unified communications can accomplish that."

Even the highly cautious are receptive if solutions promise tangible benefits. Tanenhaus finds business continuity a tough sell at the moment -- "they view it like buying insurance, an extra expense," she says -- but IT management solutions are appealing because of the productivity gains and cost savings.

"You really need to come up with metrics, such as the implementation time frame, the total cost of products, services and training, and the expected ROI," says Tanenhaus. "Education reduces fear, so the more information you can provide, the more in control customers feel." At times such honesty can kill a sale, but the benefi ts to the relationship compensate for lost revenue.

Selling more to existing customers requires a well-prepared sales staff, and that means additional sales support. Mavenspire's budget for marketing and advertising has been maintained, but the message has been tweaked. Advertising and sales collateral now stress safety, cost cutting and case studies of successful implementations, not leading-edge technology and change that might scare the skittish.

To ensure that salespeople understand the breadth and depth of the company's solutions, management has increased sales training. Team selling is the order of the day: No salesperson goes out unless paired with a business consultant or engineer. And rather than pursuing frenetic activity, salespeople are encouraged to take all the time they need with wary clients.

"In a downturn, more handholding is required," says Tanenhaus. "Things aren't going to move as quickly as when the economy is booming and everyone has money to spend."

NetGain: Selling the Safety of Managed Services

You'd never know the economy was down by talking to Michael Minnich, president and CEO of NetGain Information Systems, a 2008 CRN Fast Growth 100 honoree. A 20-person network integrator and managed services provider in central Ohio, NetGain's sales pipeline is full. Minnich expects revenues to increase 35 percent this fiscal year and well into 2009.

He accounts for this in part by the "five nines" of quality NetGain offers in converged network solutions -- quality that clients don't always receive in rural Ohio. More important, however, is a business strategy that emphasizes managed services, which Minnich considers the perfect solution in an economic slump. "Nervous clients buy safety," he says. "They're not looking for the lowest price, but for solutions like managed services that lower risk and make expenditures predictable."

As an example of this mindset, Minnich cites a recent sales call to a small business that was paying for four hours of technical support a month. The owner had complained about the quality of service, understandable in light of the time-based, reactive service contract. Believing her to be price-sensitive, Minnich expected sales resistance that never came. "When I laid out our complete managed services portfolio, she was more than willing to spend six times more per month in order to lower her business risk," he says. "That has to be the lead story when times are tough."

Minnich hopes to repeat this success by transitioning all his clients to managed services. The sales message is simple: "Stop trading dollars for hours, and let's trade dollars for results. Instead of paying us for downtime, pay us for uptime. Instead of praising fast response to a crisis, evangelize our ability to avoid crises altogether. If your business is more successful, our business will be more successful." Clients have been receptive. Managed services now account for nearly 60 percent of NetGain's revenue, and they often lead to networking projects that make up the other 40 percent. Minnich likes this ratio because of the business value clients receive from managed services, and the high gross margins from recurring, flat-rate contracts. In fact, his sales compensation model encourages sales of high-profit services and projects. "In a recession, instead of rewarding salespeople for the number of proposals, new accounts or opportunities in the pipeline, they should be compensated based upon gross margin -- especially recurring margin," he says. "This encourages sales of solutions that benefit both the clients and the solution provider."

SymQuest: Selling Value to the Top

When the economy tightens, technology budgets can shrink. That's why salespeople at SymQuest Group, a $32-million solution provider in northern New England and upstate New York, make it a habit to target C-level executives, vice presidents and business owners, rather than IT staff.

"Most people in an organization work within a budget," says Mark Lorenzini, director of sales at SymQuest. "When you work with top executives and you build a good business case, they'll create budget to fund the project." This strategy is serving SymQuest well. Sales of the company's broad portfolio of IT solutions, copiers and managed services are brisk, with very few customer cutbacks.

"Our conversations with customers aren't framed in terms of tough times at all," says Lorenzini. "People are watching what's going on, but they continue to invest in technology as long as they can connect the dots to a business return." Returns from the company's print management services are especially strong. By extending its focus beyond data networks, servers and PCs to scanning, printing and copying, SymQuest offers a holistic approach that provides differentiation and added value.

Lorenzini cites the example of a typical 50-person business, which might have two or three copiers, several laser printers and myriad inkjets. The copiers are probably costeffective, the lasers and inkjets probably aren't, but because of their perceived low cost, the company doesn't manage them and has no idea of overall page costs.

To uncover inefficiencies, SymQuest performs a free audit that discovers all print devices on the network and analyzes their usage and cost per page. This results in a report that usually reveals wild inefficiencies -- invaluable information for business owners or CFOs to have. Then the sales team presents the benefits that could be gained through Sym- Quest's Alliance Print Management services, or by improving the utilization and placement of existing devices.

Such high-level selling requires a highly experienced sales staff, which Lorenzini believes takes on added significance in a down economy. "Recruiting and maintaining a high-caliber sales team is the secret sauce," he says. In evaluating a salesperson's potential, Lorenzini looks for an ability to determine clients' needs and align closely with them -- a challenge for some salespeople who feel pressured to sell a limited solution set.

He advises getting top executives talking about what they want to accomplish, and then honestly assessing whether there's a fit. Even if there isn't, Lorenzini finds an upside: "Bad news early is good news," he quips. "I'd rather be turned down right away than spend three months working with lower-level people only to discover there's no match."

Intellicom: Moving Forward by Going Back to Basics

Rural America may not be much affected by the national credit crunch and the real-estate collapse, but that doesn't prevent business owners from turning cautious. As a result, Intellicom Computer Consulting, a $4-million services oriented solution provider in central Nebraska, has experienced its first slowdown in more than two years, after six years of robust growth.

"If Q1 and Q2 are indicators for the rest of the year, the sky is not falling and it's not a crisis," says Dan Shundoff, CEO of Intellicom, whose lead vendors are Cisco, Microsoft and HP. "We're still experiencing quite a bit of activity in our sales pipeline and in our opportunities, but the pace of that activity isn't as feverish as it was in the past 24 months." Shundoff attributes this to cautious customers deferring large-scale deployments, such as new telephone systems and server consolidation. He's confident the pattern will reverse later this year and into 2009 as the national economy improves.

Still, two bad quarters defines a recession. Did the slowdown cause Intellicom to shake up its sales function? No, because Shundoff believes in the company's unique sales strategy, where only one or two salespeople pursue new accounts. Technical and customer-service staff do most of the selling, a consultative model based on carefully listening to customers, jointly scoping out their business challenges, and delivering needed solutions and services.

"Our staff proposes solutions that either save customers money or create additional revenue and efficiencies," he says. "We would be doing them a disservice if we changed that during a downturn."

Intellicom did alter its sales tactics slightly to make it easier for customers to buy. Say a large-scale deployment of a phone system or server infrastructure is on the table. "Even customers convinced of the benefits can be strapped for cash, so we now present leasing options to lower the funding barrier," says John Elliott, vice president of business development at Intellicom. For the most hesitant, Intellicom will propose workarounds that deliver partial benefits while leaving the door open for the full solution later.

The slowdown has caused Intellicom to increase the intensity of its sales activity, prioritizing day-to-day contact with customers to understand their concerns and solidify the relationships. "It's important to retain focus and keep the customers' best interests at heart, without letting desperation leak into your conversations," Elliott notes. "They can always sense that."

Shundoff elaborates on this "back to basics" theme: "If your customer relationships aren't grounded in some core service that insulates you from the competition, you start to lose focus," he says. "My advice for a downturn is, resist the urge to chase something new. Instead, focus on your core service delivery model, control your spending to the best of your ability and don't panic."