What is a Compelling Event?
A Sales Compelling Event is a customer’s business pain that needs to be solved/opportunity that must be captured by a certain date, or else.
In other words, a compelling event has an economic owner, a defined date and is a direct response to a business pressure. The action to deliver a significant business result, either to capture opportunity or to reduce pain. The event itself defines the reason for the economic owner to act now.
Why are Compelling Events important?
Merchants have many compelling events (business pressures and opportunities) that are routinely spread across every calendar year. Some are variable (showing up almost unexpectedly) and some are fixed (consistently and predictably occurring at various date-points).
Compelling events trigger buying decisions – drive funding decisions.
Knowing your way through the compelling events that are driving the funding decisions on the specific deal you are working on, as well as those that affect all of your prospects and customers routinely, allows you to consult them that much more effectively as their Trusted Advisor.
This in turn drives your efficiency on shortening sales cycles and helping more customers get funded.
Tax Extension Deadline
This compelling trigger event is the October 15th Tax Extension Deadline
The ordinary Calendar Tax Year’s important tax dates are as follows:
- 1st Quarterly Estimated Tax Payment – April 15th
- 2nd Quarterly Estimated Tax Payment – June 15th
- 3rd Quarterly Estimated Tax Payment – September 15th
- 4th Quarterly Estimated Tax Payment – January 15th
Then the usual income tax filing date is April 15th, unless you file an extension, while S-Corporations and Partnerships must have their tax returns done by March 16th.
If a merchant needs more time than the April 15th (July 15th this year) deadline to complete their tax return, they can go on extension and push their deadline to October 15th.
Covid pushed Q1 and Q2’s estimated tax payments to this past July 15.
2019 tax return deadlines were also pushed from April 15th to July 15th.
Why does this matter?
Most small businesses go on extension because their tax returns are a bit more complicated. Often, SMB’s accountants and bookkeepers will advise them to go on extension. It gives them a bit more time to work through all their other non-SMB clients to get their returns completed by April 15th (so they can get their expected refunds).
More often than not, SMB’s will owe more than they will expect to be refunded by the government. And this is why their returns should not be rushed, and all the pertinent information must be taken into account.
Although the deadline can be extended to October 15th, this deadline moved is for submission of completed tax returns – not tax payments.
SMB’s still must estimate their taxes due and send them in on the usual deadline (April 15th), this year July 15th.
Going on extension gives merchants the benefit of extra time in which to examine expenses more thoroughly and pinpoint overlooked opportunities for write-offs. This enables them to maximize the refund potential for any overpayment on the estimated tax payment.
This year, Covid has slowed all taxpayers, as well as tax professionals down.
And even though the October 15th deadline is around the corner, many merchants still need more time. But the truth is late filers face a penalty of 5% of the unpaid tax they still owe, and its charged for each month or part of a month a return is late.
Tax liabilities drive relatively fixed compelling events, happening like clockwork every year, triggering demand for funding.
Like farmers keeping track of the sun and the moon in the sky for their harvests, Funding Pros must keep important trigger dates at top of focus to better execute best timing for follow-ups, engaging in effective talk-tracks and getting deals across the finish line.
Many SMB’s are working with their tax pros now and will need their Trusted Advisor on the funding side to be plugged in and ready to go when the time’s right.
How many of your clients are on extension?