This LOI template will close deals quicker (works for all kinds of contracts)
Are you in the final stages of negotiating a deal with a large customer or partner? And now you need to send over the paperwork?
Here’s a simple sales hack to get a LOI (Letter of Intent) template that will get signed quicker, and reduce the amount of legal hassle to a minimum. This works for a letter of intent, as well as other kinds of purchasing contracts, letters of agreement, term sheets, etc.
The typical way of crafting contracts: Slow, painful, and expensive
Even if you use a good LOI template, you’ll often find that it creates a lot of friction. Here’s what the typical process looks like:
- You download a template online and tweak it to your own needs with the help of your lawyer, or you use a friend's LOI.
- You send your LOI to your customer.
- Your customer sends your LOI to their legal department.
- Their legal department will dissect your LOI as if they’re the CSI investigating a high-profile murder case. They’ll go over every line, every single word to make sure that it’s 100% waterproof. The legal department doesn’t care how long this takes. They just want this to be safe for the company to sign. They want to put themselves in as much a favorable legal position as possible. This can take a lot longer than you’d expect.
- Then they’ll make edits and comments, and send those back to your buyer.
- Your buyer will then send those over to you.
- You’ll adjust your wording according to their requests together with your lawyer.
- You send the revised LOI back to the buyer.
- They send it to legal again.
- This can go for several rounds …
It’s like a big legal ping pong match between lawyers. Very expensive, time-consuming and tiring. It can slow down your sales process considerably.
The 1 thing you need to avoid
Wasting a lot of time in the contracting stage is something you want to avoid as much as possible. It can even starve a good deal to death, because during the weeks and months it takes a buyer to sign the damn thing, something else comes up in their company that nips the deal in the bud, and makes it irrelevant for them.
Keep the process moving forward. It’s too frustrating to lose a deal right in front of the finish line.
How to get the right LOI template for your buyer
Rather than trying to come up with a letter of intent in a vacuum, you ask them for one, and use that as your template!
Call up your buyer and say:
“Hey, can you share a letter of intent or a contract that you used in the last six to twelve months that was already approved by your legal department when buying something similar to our service or product? Have you bought something similar in the last year or two that went through procurement and legal and got checked off, got green-lighted?
If you have a deal like that, can you share that letter of intent or contract with us?”
The buyer will send it over to you, and you have your perfect LOI template for this buyer. Just edit it to your needs.
The big advantage is that it’s pretty much already pre-approved. You’re using the wording their legal department is comfortable with.
You’ll get through their legal department a lot faster, they’ll sign sooner, and you can close the deal quicker. You get their money, and they get your solution earlier. And you can perform that favorite change in your sales CRM: changing the lead status to "closed". Everybody is happy … except maybe the lawyers who are being paid by the hour. ;).