Why Customers Ask for a Better Price and How to Keep More Margin

Why Customers Ask for a Better Price and How to Keep More Margin

If you’re like most sales people, you routinely face price objections. Of course it’s going to happen; it’s the buyer’s fiduciary duty to ask for a better price. After all, if they don’t ask, they’ll never get a better deal. And your competition often wants to sell based on lower price and customers expect you to match prices. It’s a challenging situation.

On the other hand, it’s your duty as a sales professional to keep as much margin as possible and still make the sale. All sales must be either strategic or profitable or you won’t stay in business.

If you cut your price in exchange for an order, that’s not negotiating, that’s needlessly giving away margin.

Keep in mind, if it was only about price, we would buy and sell everything on eBay and wouldn’t need sales people.

Get used to defending your price and begin to make your price a reason for your customer to buy from you. Read on to learn how.

Don’t Offer a Discount

Never, ever offer a discount without the buyer asking for one. Most sales people who do so think that they’re making a pre-emptive strike on a discount request. All they’re doing is needlessly giving away margin. Sales managers: retrain or release these people.

When a customer asks for a deal, reply, “Why are you asking for a lower price? Would you like for me to not include something that you have in mind?”

Push Back When Customers Ask for a Better Deal

If the customer says, “Your price is too high,” you must find out what they mean. “Too high? What are you comparing us to?”

You have no idea how to adjust the deal unless you know what “too high” means. Are you two cents too high? Two dollars to high? Two million too high? Are they comparing apples with apple pie?

You have nothing to lose and everything to gain because asking for a better deal is a reasonable indication of purchase readiness. Explore if they have a true price issue or are just negotiating a better deal.

Suggest Another Option

When they continue to press for a price cut, offer, “May I explain why we charge what we do?” Then list all of the value propositions that they have found desirable. Say, “If this isn’t what you want or need, let’s talk about a different solution that would cost less.”

Remember that discount discussions are a taught negotiating behavior, so be prepared with your response. I went in depth on how to combat your competitors, especially when customers use them to demand lower prices in a recent on-line event. You can watch the playback here.

This week, keep more margin!

Mark S A Smith

P.S. I’ve created for you an on-line training session that goes much deeper into the customer acquisition process. Sign up here to take the class as my guest.

If you’d like 15 minutes to talk about how to build your customer acquisition system, contact me at MarksSchedule.com and we’ll set up time to meet.

And you’re encouraged to publish and share this with others; just include: “Get more business-boosting ideas like this — sign up at MarksEzine.com.”

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