Selling IoT devices to businesses: the pilot, the proof and the purchase order

"Let's put a few units in and see how it goes." Most pilots that drift start with that sentence, agreed with an engineer over WhatsApp. A pilot ends in an order when the decision maker chose its goal and its finish date. Both sides agree the proof before the first device is fitted. The rollout price is already on paper. Without those, the devices keep sending data nobody acts on, and the pilot never formally ends.

Why a pilot without a goal drifts

An IoT pilot produces data from day one. That feels like progress, so nobody notices that data is not proof. A dashboard of vibration readings or room temperatures answers no question unless someone asked one first.

The engineer who invited you is curious about the device. The person who signs the order is curious about money, risk or a complaint from a customer. If the pilot was set up to satisfy the engineer, it ends with a happy engineer and no order. The general problem of a pilot with no owner is in why pilots stall after the proof of concept. Here the product is hardware on a factory floor.

Before you agree, ask four questions

Agree to a pilot only when you get a clear answer to all four:

1. Who signs the order, and will that person see the result?
2. What will they do differently if the pilot works? "Know more" is not an answer. "Stop the night shift compressor when the line is down" is.
3. Where will the devices connect? Mobile signal in a steel shed, a Wi-Fi network the IT team controls, or a gateway on its own SIM.
4. What does the full rollout look like, in device count?

Skip the pilot if the buyer cannot answer the second question. Nothing to prove. Skip it also when the device costs less than the pilot's time. Sell the cold room alarm that clips on in ten minutes as a starter kit. Full price. And if a consultant wants three units "to evaluate for a client" who is not named, offer a demonstration instead. Whether to charge for the pilot is a separate decision, covered in free trial or paid pilot.

Price the site, not just the devices

IoT pilots lose money in the parts nobody quoted. An electrician has to fit current transformers inside a live panel, and the plant may allow that only during a shutdown. The gateway needs a power point. The SIM needs a recharge. Someone has to sit with the IT head and explain where the data is stored.

Then comes the yearly charge for the platform or the connectivity. If the buyer's accounts team hears about it for the first time at the purchase order stage, the order goes back for approval. Put the recurring cost in the pilot letter, in the same table as the device price.

What counts as proof

Agree the proof before installation, in a form the decision maker reads without a login. Three kinds of proof hold up.

• A finding acted on. The data showed five machines drawing power while idle, and the maintenance head switched them off.
• The buyer's own reading. The electricity board meter, the diesel register or the complaint log, compared over the same period before and after.
• An event caught. The cold room door left open on a Sunday, flagged by the alarm and recorded with the time.

Do not offer a percentage saving as the proof unless the buyer's own reading can show it. A saving calculated on your dashboard from your own data is the one figure the owner will doubt.

A pilot letter to send before the first device is fitted

Keep it to one page, addressed to the person who signs.

Pilot of [device] at [site]

Goal, in your words: [the decision you will make if this works] Area covered: [department or line], [number] devices, fitted by [name] on [date] Proof we agreed: [finding acted on, or reading compared, or event caught], judged by [name and role] Finish date: [date]. We meet on that day to decide. Site needs: [power point, network, shutdown slot, IT contact] Pilot fee: [amount], credited against the order if you go ahead If you go ahead: [device count] devices at [price], plus [yearly charge] from year two If you do not: [devices returned, or kept at an agreed price]

The two lines buyers argue over are the yearly charge and the "if you do not" line.

Imagine a power-monitoring firm in Coimbatore

Imagine a Coimbatore firm that makes wireless power-monitoring nodes. The maintenance engineer at a spinning mill in Palladam agrees to six nodes on the ring frames. Nothing is written down. The data looks good, the engineer checks the dashboard for a while, and the mill's managing director never sees it. When the firm asks for an order, the engineer says the MD decides. The MD asks what the mill saved. Nobody can say, because nothing was measured before and nobody acted on what the nodes showed.

The firm's owner asks for a meeting with the MD and starts again with the letter. The MD's goal is plain: find where power goes when the frames are not running. The area becomes the whole ring frame department. The proof becomes the department's own meter readings over the same period, read by the mill's electrician, plus a list of findings the maintenance head acts on. The rollout price for the department and the yearly charge are on the page. The mill's electrician compares the department meter over the same weeks and finds that four of the ring frames drew power through a long stoppage because their auxiliary panels were never switched off. On the finish date the MD reads a two-page note and checks it against that reading. The MD argues about the yearly connectivity charge, which the accounts head had not seen before, and the firm agrees to hold it for the first two years in return for a three-year commitment. Only then does the MD sign for the department. The firm gave up some margin to close it.

Put a goal and a finish date on every open pilot

List your open pilots and, beside each, the goal, the person who signs and the finish date. Any blank is the next conversation. Then ask yourself whether you can write the buyer's "what will they do differently" line for each one. If you cannot, that pilot is not ready to run. Giving the pilot a rule for entering and a rule for leaving is part of sales process design, and the wider sale is on the electronics and embedded systems page. When you want help with it, tell us what you need.