***Sales Management - 7 Selling Tips on Handling Price, Price, Price

Price is tricky. Price could be what s/he wants if everything else is the same. Price could be what someone tells you when they want to get rid of you. Price could be for a resell and the final seller only knows how to sell low price. Price could be what a subordinate thinks the boss wants, as in, “Get us the best deal.” Price could be in this range, or within my budget, or what I can afford. Price could be, “We’re big and we know we can squeeze you.”

So here are some tips to handle price.

1. Learn what's most important to the buyer relative to your product or service. He'll say "Price," but then you say, "What else?" Keep drilling down to understand his vision about what your service or the end result will do for him. What’s he afraid of? After he tells you, ask again, “OK and what else is important?” What’s he worry about? What’s he want to accomplish? This will provide ammunition later.

2. What’s she expect to be in the price? Don’t be afraid to ask even if there is a spec. Terms and assumptions can be misleading. She wants it delivered on time. When exactly is that? She wants good service. What constitutes in her mind good service. Ask her to define good service. Do this term by term because there may be things she doesn’t care about as much or not at all, yet they’re in the specs. Or, you think it goes without saying. Many times the buyer will say, “Give me the same as last time or what we have, but cheaper.” Don’t assume that all the components of last time are critical to this buyer

3. Be prepared to offer some ideas that you think should be important just in case he says, "Price and that's all." i.e. you might say, "Well, what about delays?" or "What about approval from the insurance inspectors? Or whatever you know should be a concern. Be careful however. What you think he should value, may not be what he values. Your job is to find out what he values and would be willing to pay extra for.

4. Ask how low the price has to be. That is, below what number, or in what range does the price have to be. If the buyer only knows how to sell low price to his end-user, then you may want to show him how to sell a higher price, by doing the above suggestions. Be careful. Contractors say this all the time, and I’ve never met a contractor that said he made money on a job.

5. Get to the final final decision maker and those in between. Subordinates want the low price based on what’s important to them, not necessarily what the top people want or want to avoid, i.e. delays, image, risk, etc

But, you’ll have to give the subordinate the assurance you can come in at the lowest price (whether you will or not) for what he wants before he’ll let you talk to his boss or higher. Therefore, you say, “We can get it to the lowest price, but before I can give you our final bid, I have to talk with the other decision makes to be sure of their expectations. If this person flinches, it a big red flag, meaning he hasn’t bought into you yet.

This is also a good strategy to use if you feel the buyer just wants a price and to get rid of you. Agree you can probably give him the lowest price, but before you can commit, you’ll have to talk with others. You’ll learn if he’s serious

6. Ask what will happen if no one can meet their price expectation. Obviously if they have a big enough budget, there will be a lowest price. However, if they can’t afford it, then they’ll have to make adjustments, and you’ll learn what’s important and what’s not.

7. Ask if she always selects based on low price. Most people will say no. So ask, “What are the criteria that make you leery of low prices?” If it quality or capability of those bidding, ask, “What would disqualify a supplier?” or “What capabilities do you use to qualify a supplier?”

Bottom line, it’s all about knowing what the buyer and the key decision maker wants. Price is only a component, but must be taken seriously. Wal-Mart has the lowest price, but you don’t buy all your goods at Wal-Mart even though they’re sold there. There are other factors contributing to your decision. Same applies with your customers. The only differences betwee
B2C and B2B sales are many decision makers and a pecking order. Get to the key influencers to learn what’s important and what’s not, and what price will win the order. Then you can decide whether or not you want to offer it.

And now I invite you to learn more.