How To Handle Discount Requests
We’ve all been there – you’ve got a great prospect at an advanced stage in your sales process and then the questions comes…
‘Can you help us out with the price?’
At which point you have a golden opportunity to get your deal over the finish line. The flip side of that coin is that if you handle the situation badly, you could run the risk of losing your margin or even the deal completely, especially in competitive situations.
What works heavily in your favour at this point is that people usually want value for money far more than they want ‘cheap’.
(It’s worth pointing out this is not actually an objection. Objections tend to be statements that don’t invite solutions rather than questions that generally do. )
Everyone loves a deal.
When I find myself in these situations, I use a system, or a process that ensures I cover my bases and handle them in a smart way:
Reiterate, justify and explain costs and value where necessary –
This could well be enough. Be confident – A lot of prospects ask this question after they’ve decided to go with you. You also need to remember that perceptions of value can vary wildly from individual to individual.
Discuss potential concessions that you can use to maintain your margins.
You should have a pretty good knowledge of what your potential concessions are worth to both you and your potential customer. If you’ve got no angles you can use, try the next step.
Negotiate on how and when they can pay before you ever negotiate on price.
I rarely see people do this but it makes so much sense. If offering more flexible payment terms on occasion means you can maintain more of your margins (without wrecking your cash-flow), it’s worth doing.
Use conditional questions to obtain a deal in principal
(If discounts are eligible).
Smart buyers will try to negotiate before a deal in principal is agreed where as smart sales people tend to try and resist this.
Protect yourself by using a conditional question with a main clause and a conditional clause, which essentially means your discount is not offered unless the other party accepts it.
“If we can do X% will you place the order today”
If you get a ‘yes’, congratulations, you’ve got a deal. If not, and you’ve followed the steps, explore the ‘No’ and try to get to the crux of ‘why?’.
You should never give the full discount you’re prepared to offer in the first instance anyway so you should have left yourself a little bit of wiggle room if you really need it.
Send the order form and request a PO or signature
Stipulating that the offer is subject to receiving your PO or order form today, or when you have otherwise agreed with your new customer.
It’s worth noting that when facing unrealistic discount requests or demands it’s usually a bad move to negotiate at all. A clear and honest “No, I’m afraid not,” with suitable explanation and empathy is all it should take to keep you covered.
It can be easy to just use conditional questions to leverage deals sometimes but the fact is the customers saving comes from your bottom line every time you offer a discount when it may not have even been necessary.
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