If you’re going to be CompetitionProof, you’ve got to be able to sell at prices that are higher than your competitors because slashing price is a frequent competitive tactic.
Based on my poll of salespeople, price objections are by far the most frequently heard objection. “They’re a good customer, but now they want me to cut my price?” “Why do buyers always ask me to cut the price, even when our prices are competitive?”
Buyers ask for a better deal because that’s their job! Your customers are often held accountable for getting the best possible deal. Yet that doesn’t always mean getting the lowest price.
I can get you a better deal. . .
Most salespeople volunteer to cut their price without being asked! There is a clinical term for that: stupid. They will drop hints like “of course there’s a discount schedule,” or “It’s the end of the quarter and we want to make our quota.”
Or they invite price negotiation from the start because they do not believe their product is worth the price they are asking.
Believe in your price
Some salespeople won’t say the price. They’ll offer, “Let me get you a quote…” or they’ll write the price down on a piece of paper and slide it across the table. This behavior signals a lack of personal commitment to the price, opening up a price negotiation.
If you want to believe in the value of your product, practice this: double your price. Go ahead, double it. Now justify this new price to a colleague. Then roll your price back to the original figure. It will feel like a bargain.
Don’t hesitate to discuss price. Practice saying your price out loud until it rolls right off of your tongue. Deliver it with the same conviction and tonal inflection that you would use to give someone your phone number or telling the time (neither of which are negotiable).
“What’s your phone number?”
“What’s your price?”
“One hundred-seventy-five-thousand dollars.”
Same inflection. You try it.
What to say when you hear “Your price is too high!”
Your customers probably have been trained how to negotiate with sales people. Basic buyer negotiating training tells them to ask for a discount at least twice before making the deal. You’ll have to resist pricing pressure several times to get back on equal footing.
Frequently salespeople respond to a customer’s price push back with a price cut. But wait a minute! Before you do that, find out if a lower price is really what’s necessary to get the business.
When a prospect says, “Your price is too high,” find out what “too high” means.
“Too high? When you say ‘too high,’ what do you mean? ‘Too high’ compared with what?”
Find out if you’re two cents too high, two dollars too high, or two million dollars too high.
Make sure that you’re making a tit-for-tat comparison when your customer declares that your price is too high. Odds are it’s not a direct comparison.
“But I can get it cheaper!”
Your customer may try to use your competitor’s lower prices to extract pricing concessions from you. They want your quality, your reputation, your delivery, your support, your guarantee, and your terms, but at the competitor’s price. They’ll compare your competitor’s apples to your apple pie, and ask for the cheaper price.
Frequently your customer has no intention of buying from your competitor. They’re just using the competitor as a negotiating tool.
You can counter this but-I-can-buy-it-cheaper tactic with the negotiating phrase: “We have no argument with those who sell for less. They know best what their product is worth.”
Or as a vendor in Maine said, “Well, it’s a lot like buying oats. If you want good, clean oats, you pay a fair price. If you be willin’ to settle for oats which have already been through the horse, well. . .”
Now, you’re CompetitionProof!