Your Price is Too High!

These words strike fear into the hearts of CEOs and salespeople like no others.  The reality is that this is the one statement we should long to hear.  Why?

Because it opens the door to negotiation.  Now if you’re not an experienced negotiator I suggest that you take some classes, read some books, do whatever you need to do to develop this skill.  It’s one that will serve you, not only in your business, but in your relationships with family and friends.

One simple question

In the meantime, here’s one question that will help you launch the negotiation.  When a prospective buyer tells you your price is too high, simply ask “What would you like to give up?”

This simple question puts them on the defensive.  They now have to explain why they think the price should be lower instead of you trying to convince them that your price is fair.  Often they’ll cite another store or the internet where they can get a cheaper price.

To which you’ll respond, “I have no doubt that you can find a cheaper price, but what will you be giving up with that lower price?”  Again, don’t be surprised if they say “Nothing, it’s the same product.”

Agree that it is the same product.  Then ask what they’ll do when they experience the myriad problems that can occur after the sale.  How will those be handled?

How will they feel dealing with a disembodied voice in a distant location that isn’t authorized to deal with their problem.  Or they’re left to their own devices because it isn’t the company’s policy?  How much time will they spend shipping the defective product back and forth versus getting an immediate exchange from you?

The goal

The goal isn’t to denigrate your competition, it’s to help your prospect understand why your price is higher than your competitors.  That there are a number of intangibles that are often overlooked that add real value and warrant higher prices.

This approach also helps them make conscious decisions about the choices they make.  If the price really is outside their budget, it opens the door for you to guide them to alternatives that will meet the majority of their needs and provide an enjoyable experience for them.

In B2B situations, that means tailoring the offering to their specific needs.  In B2C transactions you offer alternative products after your questions have ferreted out what’s most important to them.

Strategy

Your sales strategy should include sufficiently high prices to get prospective customers to say “But your price is too high!”  It opens the door for you to:

  • Discover what’s really important to your customers versus what’s nice to have.
  • Guide them to making informed decisions that benefit them and you.
  • Get higher prices despite what your competitors or the economy are doing.

In those instances in which the customer really only cares about price, it’ll let you recognize that condition early in the sales process so that you limit the amount of time and energy expended in what will inevitably be a failed effort.

Once you’ve developed the skills you’ll find that negotiating is a lot of fun.  It’s a wonderful outlet for the creativity that exists within each of us.  Enjoy!

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