EVERY SALESPERSON HEARS IT. SOMETIMES IT’S true; other times it’s a negotiating ploy. Either way, the “They have a lower price” objection is a pivotal moment for that sale. Many salespeople, however, haven’t learned how to handle it smoothly and confidently. The temptation, especially among newer salespeople, is to lower one’s price in the hope that the sale will be made quickly. But instead, more challenges arise. If the sale closes with the lowered price, not only is margin reduced, but also that customer has now been trained to challenge price reg- ularly since he or she was rewarded for doing so. With that in mind, here are four points on price negotia- tion that all salespeople should know:
1. If they’re focusing on price, you haven’t sold value. What one sells is a package of services and conveniences. Yes, products are involved, but there is also confidence and experience. Don’t lose track of the big picture—would you choose a gas station with slightly lower prices if it was located on the other side of town?
2. The prospect is more interested than he or she appears. If you and that lower-priced competitor were truly equal in the prospect’s eyes, this sale would already be over and lost. Something else is going on here—the fact that he or she is raising this objection means you are a contender.
3. Lowering price for no reason makes everyone miserable. When people ask for a lower price and get it, you’d think they’d be happy, but it’s just the opposite. Here’s a simple example that shows why: Suppose you stop at a yard sale and see a camera you want. Complete with the case, the seller wants $100. You counter with $80. The seller says okay. Are you happy?
PUTTING PRICE IN ITS PLACE
How to handle the “They have a lower price” objection. by Ken Wax