Back Door Selling - Explained
What is Back-Door Selling?
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Table of ContentsWhat is Back Door Selling?How does Backdoor Selling Work?Academic Research on Back Door Selling
What is Back Door Selling?
Back door selling is defined as a strategy used by sales personnel to extract information about a company in order to have an edge over other investors. This is a dishonest tactic and it is regarded illegal. Sellers use this strategy to cleverly extract information that the buyer might ordinarily not want to disclose. Through the means of enticement and other tactics, sales personnel gain information that put them at an edge over competitors and even the buyers involved. Also, sales personnel can also have buyers purchase their goods without any competitive bidding or negotiation through the back door selling.
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How does Backdoor Selling Work?
In a situation of backdoor selling, cleverly crafted questions are asked by sales personnel just to extract useful information about a buyer or a company. In most cases, buyers who are unaware of the notice of the seller divulge important information which the salesperson leverage on.
Backdoor selling is an illegal practice because the information is gained in a dishonest way and leaving the buyer disadvantaged. When backdoor selling is used, buyers are made to purchase products without negotiations or competition for a contract or sale by other companies. The buyers are unlawful enticed without having a chance for other bidding or negotiation. A backdoor selling technique is also described as a social engineering practice used by a supplier to gain useful information before competition for a sale begins.
This selling technique uses well-crafted questions tailored towards important people in a company. Line managers, HR personnel, warehouse workers and others can fall prey of the innocently asked questions that suppliers use. Essentially, sales personnel use the backdoor approach for two main reasons, to have information that competitors do not have and gather sensitive information about the buyer. The information that the seller gathers is helpful in gaining an edge over other competitors and even the buyer. It is however important to note that sales personnel who use the backdoor selling method careful choose their prey. That means, the cleverly-crafted questions are not just directed towards anybody. They carefully select who they ask those questions. Usually, people or staff who are not directly involved in a purchase but are part of the buyer's team are approached by salespersons. These people are called Non-purchasing personnel. Non-purchasing personnel who are unaware of the motive behind the questions asked innocently divulge sensitive information about the buyer. Salesperson who use this method are skilled persons, they ask questions such as;
- Who supplies your materials?
- What are the qualities you expect from the inventory being supplied?
- Why do you prefer your present supplier?
- Are there areas the supplier is under performing and you need a change? and many others.
Academic Research on Back Door Selling
- Back-door selling: Violation of cultural versus professional ethics by salespeople and purchaser choice of the supplier, Trawick Jr, I. F., Swan, J. E., & Rink, D. R. (1988). Journal of Business Research, 17(3), 299-309.
- Convertible bonds as" back door" equity financing, Stein, J. C. (1992). National Bureau of Economic Research.
- In through the back door: Social equity and regional governance, Bollens, S. A. (2002).
- Trade promotion: Essential to selling through resellers, Ailawadi, K., Farris, P., & Shames, E. R. (1999). Sloan Management Review, 41(1), 83-83.
- Through the Back Door: Attempts to Use Trade Dress to Protect Expired Patents, Gill, G. (1998). U. Cin. L. Rev., 67, 1269.
- The meaning and origin of trust in buyersupplier relationships, Smeltzer, L. R. (1997). International journal of purchasing and materials management, 33(4), 40-48.
- A case study of NUMMI and its suppliers, Newman, R. G., & Rhee, K. A. (1990). Journal of Purchasing & Materials Management, 26(4), 15-21.
- Civilizing and selling spectators: Audiences at the Madison Civic Center, Wolf, S. (1998). Theatre Survey, 39(2), 7-23.
- Selling China Looking Back and Looking Forward, Beamish, P. W., & Delios, A. (2005). Management and Organization Review, 1(2), 309-313.
- Fitting purchasing to the strategic firm: frameworks, processes, and values, Freeman, V. T., & Cavinato, J. L. (1990). Journal of Purchasing & Materials Management, 26(1), 6-11.