We used to say that while asking a question to experts, you would receive as many answers as experts you ask your question to. No reason to be different in Energy Efficiency. Thus, Energy Efficiency engineers would legitimately give different answers depending on their own expertise (metering, automation, thermal, electricity and so on) and on the firm/product line they belong to.
My personal answer based on field experience is the following: You should start your Energy Efficiency project certainly not with an offer! Neither an audit, nor a metering systems’ installation. You should start it with questions and a genuine ability to listen to your client’s answers. Finally, this is basically a regular sales approach sometimes some engineers tend to negligate a little bit too much.
What would be the related questions? In a sales context, questions are numerous and they would depend on many different factors, such as client’s core business, site’s location, client’s Energy Efficiency maturity, or sales context itself. I won’t dig into all of them, but focus on 3 ones you would have the opportunity to ask every time.
These are the 3 questions you may want to have in mind:
- Who’s in charge of which budget (investment and O&M)? Implementing Energy Efficiency is a matter of total cost of ownership. As often, firms or authorities manage their budgets with different people, ones in charge of investments budget, others in charge of maintenance/energy/operations budget. Willing to sell a great Energy Efficiency solution that often represents an upfront cost (an investment) and always provides savings on maintenance or energy costs, you may want to have in front of you the decision makers from the beginning. Sometimes, you could have, let’s call her, the budget boss who’s in charge of both budgets, sometimes you could have several people around the table. Stop talking. Think about it. Ask it. And listen.
- What are their energy prices? Energy prices vary from a consumer’s profile to another, from a location to another, from a energy supply contract to another. Energy prices are decisive to energy savings and payback time calculations. They can vary significantly and you don’t want to figure out afterwards that your solution is not worth it. So, it seems to me that one of the first things to ask is: what are your energy prices? and how do you forecast them?
- What’s their acceptable payback time? Finally, the last but not the least is also related to your payback time. Facing for most of them financial and sales difficulties, your clients don’t want to spend time working on non profitable solutions. Again, this value, which is decisive to Energy Efficiency project’s implementation, can vary a lot, depending on your client’s industry, internal rules, and project’s nature. Usually up to 2 years in manufacturing, it can go up up to 10 to 20 years for some local wealthy authorities. Similarly, your client maybe doesn’t think profitability and project’s go-no-go decision in terms of payback time, but in terms of IRR, NPV or hurdle rate. Just ask them both internal standards and internal values.
Next time, we’ll talk about best practices to present an Energy Efficiency offer to your clients.
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