Pricing Objections – Don’t Let Them Beat You

May 31, 2010 by  Filed under: Sales 

Unless you sell products and services that no one else does, the selling price of your products and services is almost certainly to become a factor in the buying cycle. At times you can negotiate when you have some room on the back end. But what can you do when there is little or no profit left? You hate to lose out on the sale but won’t give products and services away. Here are a handful of recommendations that can help you handle pricing objections.

1. Find out the differences between your proposal and your competitor’s. There are many reasons that the pricing might be different. Determine if their selling price is a limited offer. It’s possible they are delivering a product or service with fewer functions. Another possibility is that the selling price they offer is dependent on quantity purchases. Take the time to learn what your competition is offering.

2. Be honest with the prospect. It is alright to admit that you cannot match a competitor’s price on a product. Most prospects will appreciate your honesty and may present other opportunities where you can be more aggressive in your pricing.

3. Break down a big price into smaller pieces. A huge number can frighten a prospective client from making a buying selection. By showing the prospective client that your products’ weekly costs or daily costs or perhaps even per use costs, you can work with a much smaller number to close the sale.

4. Do a comparison of your prices to the Prospective client. This strategy may get a little difficult based upon how your products compare to that of your potential customers. Here is an illustration of how this strategy can work. “Tell me, are you generally the cheapest service provider in your market? Well, neither are we. Like you, we command a fair selling price for outstanding products and services. And that’s why I’m so energized about working with you. But if all you desire is the most inexpensive widget on the market, I can introduce you to several low-cost companies from whom you’ll get exactly what you pay for.” This is a really successful approach when used at the right time and with the appropriate mindset.

5. Walk away. I realize it’s not perfect, but it is much better than losing money on a deal. You have to recognize that you don’t want every prospect to become a client. Part ways as friends and it’s possible you can do business in the long term, when that low cost competitor goes out of business for not charging enough for their products!

These tactics work well with each other over the course of the sales routine. You tend to use each of them on a normal basis, including number 5. Keep in mind that your task is to educate and offer solutions. If you clarify the value that the prospect will be obtaining they will be ready to justify the cost and you will get the sale.

Mike is the owner of Spitfire, producer of predictive dialer software that greatly increases the effectiveness of calling agents.

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