How To Close A Deal Like Warren Buffett
by Tom Searcy and Henry DeVries, 2013 (McGraw-Hill, $36)
Business consultants/ authors/Buffett fanboys Searcy and DeVries have distilled years of closely following the Oracle of Omaha into a handy hardcover comprising 18 lessons in dealmaking.
While Buffett has had a few duds (he’s only human), by and large he seems to home in on businesses that go on to make him boatloads of money.
As one of the world’s richest individuals, his investing style has come under scrutiny from no shortage of people hoping to replicate his success.
Famously, his two rules in business are 1) never lose money and 2) never forget rule one. Buffett favours ventures that are guaranteed to provide a good return, tried and tested companies in stable industries (food, jewellery, manufacturing) that he understands – hence why he steers clear of technology and financial services. Fortunately, that’s not a philosophy shared by all investors, or entrepreneurswould never get off the ground without those willing to take a punt on new ideas that just might change the world.
These 18 lessons don’t just apply to investing. How To Close A Deal Like Warren Buffett is ostensibly a manual for anyone involved in making business deals, from learning to speak the language of big deals and getting into the offices of dealmakers.
Want to step up your game and close bigger sales contracts? Then think like Buffett – go big or go home. To solve problems for top level executives who hold the purse strings, your approach needs to be adapted accordingly - if you keep playing by the same rules, you’ll keep getting the same results. That doesn’t mean overpromising and risking underdelivering, however – the best bet, according to the writers, is offering a solution with an improvement rate of 8-14 percent (a reduction in costs or turnaround time, for example). That’s a credible range – any more and it’s likely to be too good to be true, but any less and it won’t seem worth the effort of making a change.
Interestingly, Buffett is also all about the people factor. He favours less paperwork as a rule, stating that the most watertight of contracts is useless when you’re up against a person who lacks any sort of integrity.
He’s invested in many family businesses (as the authors point out, doing business with big ‘logo’ companies can burnish your reputation, but they’re slow slog and often more trouble than they’re worth) and insists on retaining management in place after a buyout.
Profits count, but people count for even more. Now that’s a philosophy we can all get behind.