from Joe Diliberto, Sandler Traing
Has this ever happened to you? During an initial discussion with a prospect, you make it a point to review your pricing information. You put everything right out on the table. The prospect tells you the price you mention "looks fine" (or is "OK," or "seems fair," or is "in the ballpark," or any similar piece of vagueness). The prospect then tells you to put together a couple of samples, designs, or prototypes. You agree, and you get to work.
You bring your samples, your prototypes, your designs, and everything else to a second meeting. And the prospect sees something exciting in what you've done . . . and gets interested.
Then, just when you think the time has come to seal the deal, the prospect says, "You know, I'm really not that comfortable with the pricing."
Wait. What happened to "the price looks fine"?
It evaporated, that's what happened. Why? Because you invested your own time and energy before you confirmed the prospect's ability to make the investment.
Long before you begin working up designs, assembling samples, or doing anything else that constitutes a significant investment of your time, attention, or other resources, you must discuss exactly what this person wants ... and why he or she wants it. Essentially, you must reaffirm the importance, not just of working on the project, but of working with you.
Then, with that much established in the emerging relationship, you need to explicitly confirm that the investment this person is prepared to make is indeed within the range you charge. That's not the same as getting the other person to say, "The price seems fine," or, "It's in the ballpark."
Here is what confirming the investment might sound like: "I'll work up two designs from which you can choose, Bill. If you choose one, are you going to be 100% comfortable making a $_____ investment? If not, we should talk about that now".
If you are going to have a "discussion" about price, the time to have it is before you begin jumping through hoops for the prospect. Once a prospect says that he or she is 100% comfortable with your price, you have effectively taken the "your price is too high" objection off the table.
Salespeople have all sorts of interesting notions about what would happen if they attempted to discuss budget, fees, funding, investments, etc. before presenting something that would justify an amount. Rarely are the scenarios that they conjure up positive ones. Yet the outcome is positive. Although the discussion just outlined may not be as familiar or as comfortable (at first) as saying, "Does the price look OK?," the method just outlined, followed by a confident silence, will save you time and preserve your margin.
You'll find that with a little practice, it only takes you a few minutes to confirm the investment. Once you make a habit of doing this, you'll waste less time with unqualified prospects, close bigger deals, and spend little or no time haggling over pricing.
About Joe Diliberto
Joe specializes in working with business owners, CEO's and senior managers to maximize the return on what is often their most underutilized resource, the sales team. To contact Joe, click here, or call 510/530-5060.
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