Making Price Concessions
Many sales reps aren’t 100% sold on the value of their product, therefore they’re apt to offer price concessions even when the prospect doesn’t ask for one. A prospect can sense when you lack confidence in your product and will be more likely to ask for a price concession if they sense your lack of enthusiasm. However, sometimes there is no other way to close the deal. If you feel that a price concession is absolutely necessary, before offering any type of price concession you should:
- Offer viable alternatives before offering a price concession.
- If you are trying to match a competitor’s lower price, verify that price before making any concession. Be certain that your competitor is offering exactly what you are offering. Often with lower prices, quality is lower, and less is include in the package.
- Make sure the prospect understands what services are (and are not) included in the new price you offer.
- Make sure you know the true cost on the product.
- Make sure you understand what kind of margin that was set for the product. You can shave your margin and still make a profit.
- Clear any price concession you wish to make with your company before offering it to a prospect.