The Best Answer To ‘Can You Match Their Price?’

Most salespeople dread the question that asks if you can match the price the competitor has offered. It immediately puts you on the back foot, as you probably wanted to concentrate on how your products would benefit the prospect and now they want to discuss price.

It can be hard to judge when price should be brought up in the conversation. Sometimes the prospect will allow you to build up the value before the issue of price is discussed. Other times, the prospect will highlight their need to know the price early on. Most of the time, you don’t have much control of when this happens.

So what should be your response when the prospect asks if you could match the competition’s price?

Firstly, you should be absolutely crystal clear that you know exactly what the competition have put forward as a ‘price’. Could it be they are making a special offer just to get this customer’s business. Are there strings attached to the price they have offered, e.g. payment up-front, no discount, delivery differences, etc?

Be clear what the competition are offering before you agree to discuss any price issues.

Here’s one way that you can deal with this kind of discussion:

——————————

Prospect: Your competitor is 15% lower than you. Can you match their price?

You: Thanks for sharing that information about their price. But, to be honest, I’m a little curious. Why are you still looking at us when you can get the same value somewhere else at a cheaper price? As much as we’d like your business, if the competition can deliver the same value at the price you say, then I wouldn’t blame you going with them.

—————————-

This question is simple common-sense. If the competitor is offering a cheaper price for the same value, what’s the reason we are still being spoken to? The prospect must justify the reason they are still keeping you in the frame.

—————————

Prospect: We’d still like to go with you…yours is the best solution, but the competition are 15% cheaper

You: Thanks, I appreciate your confidence in us as a solution-provider. Let’s take a look at the proposal we discussed and confirm the highest ROI areas. Then we can both take a look at how we can review some of the points in the proposal to achieve your budget.

—————————

So, instead of reacting and quickly discounting your products to match the competition (which might make the prospect think he can get an even better deal if he went back to the competition), you can discuss with the prospect which areas weren’t as important to him as first thought. It’s not about the discount; it’s about what they are willing to commit to in order to still solve the problem or take advantage of the opportunity.

Remember, it’s all about getting the prospect to determine if they can really afford NOT to have your solution. The above responses can help you redirect the attention away from price and toward the real reason why they will make a choice…the best solution to their current needs.

Happy Selling!

Sean McPheat

Managing Director

MTD Sales Training

www.mtdsalestraining.com

(Image by Stuart Miles at FreeDigitalPhotos.net)

The Proper Way To Reduce Your Price During The Close….But Only If You Have To!

Offering a discount to help motivate the prospect can often be a powerful inducement to close a few more sales.  However, dropping your price in the wrong way will cost you a ton of lost sales, it will reduce your margins to nothing and in addition you could lose the prospect’s trust and respect and possibly damage the credibility of your company.

The Steps to a Price Reduction (In the right way!)
Offering a discount is a delicate issue and you should only use it as a last resort.  However, when necessary, follow these steps:

1. Stand Firm 3x

2. Build Value 3x

3. Reduce the Price for a Valid and Justifiable Reason

1.     Stand Firm 3x
After you have offered a price and attempted to close on that price, you have to understand that you cannot just arbitrarily change it.   Once you made an offer, you must stick to that original offer and price as long as possible.   If you change or reduce your price too quickly, then what was your first price? Was the first price just a way to see how much you could get?  Stand firm on your original price, and close on it at least three times, before even thinking about a discount.

2.     Build Value 3x
As you are closing on the first price, continue to raise the value of the product or service.  Remember, price objections are actually about value, not money.  Continue to increase the value and costs of the prospect’s problems and pain. Raise the value of the original offer at least three times.

3.     Reduce the Price for a Valid and Justifiable Reason
Now, you are ready to slightly reduce the price, but only for a good reason.  You must have some justification to lower the offer.  If the prospect feels that your price drop is nothing more than the stroke of a pen, it becomes worthless.   Find valid reasoning and reduce the price as if it is your money that you are giving away. So you can drop the price by 10% but what gives? Also, this is also a great place to get referrals.  You can essentially buy the referrals from the prospect, offering the price reduction in exchange for contacts.

  • Stand Firm 3x
  • Build Value 3x
  • Reduce the Price for a Valid and Justifiable Reason

If you reduce the price incorrectly, you reduce the value along with the price.  If you price drop as above, you will raise the value as you reduce the price.

Happy Selling

Sean

Sean McPheat
Bestselling Author, Sales Authority & Speaker On Modern Day Selling Methods

MTD Sales Training

End Of Sale Negotiation Tactics

We’ve all been there…

“What’s the best price can you do? Can you offer me a discount?”

And then the negotiation starts!

The fact that you’ve received that response means you are nearly there in the first place! And now with just the right approach you can get back to the office and update your CRM system with a CLOSED WIN in next to no-time!

My approach to responding to discounts and counter offers is the following:

VALUE X 2 MINUS 1 PRICE

What this means is that when you’re faced with a “Can you give me a discount?” response you should not just cave in to start with. Instead you should respond with a value building statement and stay firm. If they come back again, then do exactly the same. But if they come back a third time then you should give a concession and ask for something in return.

You’ll be amazed at how little you actually have to give discounts by standing firm!

Now I love getting referrals in exchange for discounts because it’s money in the bank.

So I’d say something like this “I’ll tell what I’ll do Joe. I’ll reduce the price by 15% if you can give me the names and phone numbers of 5 quality referrals that you’ve worked with who also need this service too. Is there any other reason why we can’t go ahead with this?”

Quality referrals are like gold dust and they have a monetary value too because the replace advertising spend, so that’s why I really like getting them in exchange for a slight discount.

So, in summary:

Remember VALUE X 2 MINUS 1 PRICE

Build the value twice before you even entertain lowering your prices and then if you need to lower your price do so by asking for something in return.

In today’s economy you’ll come across a lot of people who will ask for discounts so practice hard on what you’ll say and how you’ll say it when faced with the “Can I have a discount?” response!

Happy selling

Sean

Sean McPheat
The Sales Jedi
MTD Sales Blog

MTD Sales Training