Thoughtful Thursdays – Negotiating
I do not know anyone who finds it enjoyable to pay more for something than they feel it is worth. Your prospects are no different.Think about the last time you experienced the price objection. This can come in many forms, but the bottom line is that you are being asked to supply more for less.
In my business to business experience, price points are often determined during Step 3 of the sales cycle, Gain Approval, when determining prospect needs.
It is after making Recommendations that negotiating often begins in earnest. Once you are at this point in the sales cycle there should be a reasonably high probability of making the sale. You want to be prepared to confidently address anticipated objections.
Back to thinking about the last ime you experienced a price objection. Were you prepared to walk away from the sale, or did you agree to a concession or was it the opening of a conversation that led to a mutually beneficial solution?
Too many times, the tent folds up and the price comes down, the customer is the winner and your pockets are lighter as a result. Fear of loosing the sale is powerful. Your defence is a well prepared response, with the objective of having two winners.
Yes, there are many scenarios to consider, however there are common points to consider for most business negotiations.
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Know at when you have to walk away
- Do the math, quantify the price differential and know how it relates to your service or product pricing – consider options that will offset the differential without moving on price.
- There must be two winners
- Quantify the benefits of buying from you
- Be clear in your mind where you can afford to be flexible and where you must stand firm
- Understand the consequences of taking price out of the service/product and be prepared to talk about it with your prospect
- Value = Price + Benefits
- Are there strategic reasons to consider such as additional business
There may be instances where you decide to concede on price. Be sure you have considered all options, know why you are doing it and understand the potential consequences of your decsion. If you are the owner/operator of your business, would you support a sales person with the same decision or ask more questions?
Good selling,
Richard
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