Sales: Question and Answer #8
This is a Question and Answer article for sales people from guest poster Dave Kahle, author and leading sales educator. Follow Dave’s latest Tweets at @davekahle.
By Dave Kahle
Q. Occasionally, customers may say they have seen or received a lower price for the same product in order to receive better pricing from us. How would you handle that type of call?
A. You mean this only happens occasionally? I’ll bet thousands of my readers see it frequently. Regardless, there are a number of things you can do.
First, assess the validity of the customer’s comment. Your question says that your customers “may say…” That implies that sometimes, at least, you think they are just saying it, and not meaning it. So, you have to determine the likelihood that they really have seen the same thing at a lower price. If you think they are just making it up, and they really don’t have a lower-price option, then just diplomatically ignore it. Say something like this, “I really don’t know what else is available, but I do know that this is a fair price. Should I send you one or two?”
You’ll never know if they are bluffing until you call their bluff. It’s worth losing one or two to help you understand the reality of their comment.
Second, if you think that they really do have another lower-price option, then you need to spend some time in preparation before you even make the call, so that you will have a strategy and set of techniques ready for this situation.
Assess your position in the account. Ask yourself these two questions: “Are you the preferred vendor?” “If all things were equal, would they prefer to do business with you?“
If the answer is “Yes,” and you are the preferred vendor, then that is usually worth at least 3%, but rarely more than 10%. In other words, if your competitor can sell it for $100.00, but you are the preferred vendor, you can probably get $103.00, but probably not $110.00 for the same product.
So, you need to determine if you are the preferred vendor and, if so, how much is that worth to the customer. Create a deal which, in effect, lowers the price to what you think you can get. Have that deal, plus some language to offer it, ready for the situation.
For example you might say, “I understand that you may be able to purchase it for less. Let me suggest this, when you buy it with item Y, we can provide it for $103.00 plus $8.00 for item Y. That gives you a discount from our regular prices, plus a great buy on item Y. Do you want to go ahead with that?”
That, of course, assumes that all things are equal. The truth is that all things are rarely equal. There is probably some reason why the customer should buy it from you. That means some benefit that the customer gets from the transaction with you that is valuable to him/her and that is not going to come from the competitor.
Just ask yourself the question, “Why should they do business with me?” And don’t answer it from your perspective, answer it from theirs.
If there is nothing that the customer gets that is valuable to him, then he should not buy it from you. Once you identify the benefits to the customer of doing business with you, you then need to prepare a statement or two that encapsulates the reason why someone should buy it from you.
There are thousands of reasons why they should buy from you beyond just the price or the product itself. There is the state of the relationship, for example. They like you. That’s reason enough. Or, maybe your invoices are clearer, your terms more flexible, your delivery more reliable, etc. Or, it may be just more convenient.
Here’s an example. Almost every morning that I’m in the office, I first stop at the coffee shop on the first floor of my building and get a cup of coffee to bring to the office with me. It’s good coffee, but no better than I can get several other places. But it is more expensive. In some cases, it’s twice as much as I would pay elsewhere. Why do I intentionally pay more? Because it’s convenient, I don’t have to go out of my way to buy it, and the people in the shop know me and greet me by name. To me, those are nice benefits, and worth an extra $.75 a day. So, while the product is the same, and the price more expensive, there are some reasons why I’m willing to pay the extra price.
Put yourself in your customer’s shoes, and determine why they should pay the extra price to buy it from you. Take those reasons, and turn them into a persuasive sentence or two. Memorize those two sentences. Then, the next time someone offers the comment, you’ll be ready to persuasively show them why they should still buy it from you.
By the way, you’ll find this kind of insight into dozens of sales issues in our Sales Resource Center. It houses 435 training programs to help every one live more successfully and sell better. All delivered over the internet, 24/7, for one low monthly fee.
About the Author:
Dave Kahle is one of the world’s leading sales educators. He’s written nine books, presented in 47 states and eight countries, and has helped enrich tens of thousands of sales people and transform hundreds of sales organizations. Sign up for his free weekly Ezine. A great source of specific tools to help you close is Dave’s book, Question Your Way to Sales Success. Check it out here.
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