Case study ... Risk reversal ... getting paid for performance ... one incredibly powerful approach

Published: 12th January 2007
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Risk reversal .Getting paid for performance . one incredibly powerful

By Kris Mills - Words that Sell
Copyright 2002 - Kris Mills

I've regularly written about the importance risk-reversal plays in
dissolving buyer scepticism. As a way of allaying buyer fears, some of my
clients have adopted money back guarantees and their sales have increased
dramatically just as a result of implementing that guarantee.

One area where buyer scepticism is particularly rampant is when it comes to
enlisting consultants. A company knows they need to enlist the services of
a consultant to increase their bottom line, yet in most cases, they've been
burnt before, paying too much money to consultants that don't come up with
the goods.

And, when I speak with consultants many tell me that their services are so
much better than their competitors, yet when asked if they are willing to
offer a guarantee, 99% say "NO".

The reason for the "NO" answer? I often get told, "Advice is only as good
as the implementation" and unless they can control implementation, they
can't guarantee an outcome.

As a consultant myself, I see their point. It's very, very true, however I'd
like to tell you a story about a global, franchised consulting group that
has been offering a bold "no win, no fee" guarantee for years, with great
success too, I might add. As a result, they have no problems getting their
feet in the doors of even the biggest multi-national firms.

The company is Expense Reduction Analysts and they offer a cost reduction
service whereby they reduce a company's business operating costs in areas
like printing, stationery, freight, telecommunications, travel and so on.
Instead of charging a fee for this service, they charge 50% of the savings
realised in the first year. If no savings are found, no fee is paid.

In reality, every company they work with does achieve savings with most
shaving 23% or more off their costs. With the size of the companies ERA
works with, this represents a saving of anywhere between $100,000 to
$1,000,000. One multinational client has just saved $2million thanks to
ERA's efforts. (Incidentally, the ERA consultants involved with the project
pocket a healthy proportion of those savings as their fee.).

If ERA consultants were to charge a set fee for their services, their income
per client would be a fraction of what it is now. What's more, without a
guarantee in place, their sales conversions would be significantly lower

With the "no win no fee" guarantee, everyone wins. The client wins because
there is absolutely no risk in dealing with ERA. Additionally, any fees
they pay ERA come out of savings realised so it is money they wouldn't have
previously had anyway.

And, the ERA consultant wins too. Their consulting fees are many, many
times what a "fee for time" consultant would charge.

As you can see, if you're a consultant or part of a consulting firm, it pays
to see how you can re-structure your services so you can offer a FEE for
results arrangement.

To find out more about ERA's "no win, no fee" offer, you can visit their
website at

While I'm talking about consultants, ERA is currently looking for
experienced business consultants (in Australia) to become self-employed
Expense Reduction Analysts, as part of their franchised operation.If you're
thinking of a career change, and you'd like to explore the Expense Reduction
Analysts franchise opportunity, just visit their international website at


Kris Mills of Words that Sell is a seasoned copywriting and direct marketing
professional and author of a number of marketing programs. Kris has
published dozens of articles on copywriting, direct marketing and internet
marketing. To read these articles or to subscribe to her ezine visit or to discover more case studies, visit

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