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:

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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.

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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.

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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.

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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)

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3 Ways to Deal With Price Pressure

The most frequently asked question we get asked on our sales courses is the one related to price. ‘How can we resist the temptation to give away the shop? We’re not a charity, but our customers often think we are’.

It’s a common complaint. Even though there’s no doubt in your mind that your product or service is worth every penny you’re asking, you also know that there are many competitors ready to cut their price and do whatever it takes to make the sale.

How frustrating is it to have to give away your product at a cut-throat price because the prospect has beaten you down to the ground, promising to buy if you would just go that teeny-weeny bit further (or 10%, whichever is the smaller)? If you play the price game, you will ultimately see your profit melt away.

So you need to have a well-thought-through process for dealing with price pressure. How can you ensure that you won’t give in on price and compromise margins and profitability? What can you do to prevent your margin being eroded to nothing?

Here are three ways to deal with the price pressure clients can force on you:

1. Make sure you know the value of your products and services and how it links to the customer’s business situation. This is the key to creating value and is at the heart of selling with integrity and credibility. A salesperson must understand the departments that are most affected by the solution, and the financial impact of his solution on various sections of the buyer’s company.

Understanding the customer’s critical issues, dissatisfactions, and frustrations, plus recognising the business opportunities that arise from them, takes research, time, commitment, and dedicated work.

2. Make sure you can help the customer calculate the cost of not going with your solution. Imagine being the doctor and your customer the patient. Identifying the cause of the pain is a pre-requisite of any remedy the doctor might prescribe. Equally, before you can offer a remedy, you must be able to firmly establish the pain of not doing business with you.

Increasing the pain and suggesting a remedy for it is the true sign of a consultant, and will take the client’s mind away from commoditising your product by focusing on the price only

3. Make sure the customer realises the benefits of your solution over that of your competitors. Be specific, and highlight areas that the client will identify with immediately. Get the customer to realise how the financial impact of your solution is worth more than taking the risk of a cheaper solution.

These ideas concentrate the client on making solid business decisions and may help you to convince them that price is only one facet of the decision-making process. It also raises the profile and image of your products and services, keeping them out of the mire of pile-‘em-high, sell-‘em-cheap offers that create poor reputations and damage brand image.

Happy selling

Sean

Sean McPheat
The UK’s #1 Authority On Modern Day Selling
MTD Sales Training

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Offer Something Better Than Discounts

How do you react when your customer requests a discount?

Usually, we react in one of two ways…either with disappointment that we hadn’t built up the value in the customer’s eyes before discussing price, or with anticipation that we may get a sale if we both negotiate to an agreeable figure.

How about trying something different to keep the customer’s mind away from discounts and onto something more advantageous to both of you?

Instead of offering discounts, how about offering bonuses?

Discounts are price reductions and lower your profit margins; bonuses are earned by the customer, rewards for performance and maintain the value of the service you are offering.

When you’ve offered a discount, it confirms a lower price can be maintained in the future, and sets a precedence for future business with you. But the expectation of a bonus encourages the customer to do more.

Here are some more advantages of offering bonuses to the customer:

They maintain the base price
They can be based on a quantity you are trying to achieve
They can encourage a customer to go for a threshold level they hadn’t thought of before
They don’t set a future precedent
They don’t have to be monetary
You pay the bonus after the order and payment, rather than up front

All these encourage the customer to think of benefits they will get rather than how much they can reduce the costs. They also help you to concentrate on offering value rather than devaluing your services, which is what discounts inevitably end up doing.

Happy Selling!

Sean

Sean McPheat
The UK’s #1 Authority On Modern Day Selling
MTD Sales Training

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