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10 Tips to help you negotiate your price

Written by: Jane Francis

Article Overview: Before you negotiate your price, first, step inside the shoes of your client and think about her fears – does she know she can trust you? How does she know you will deliver good value for money? Will you make her look stupid for buying from you?

10 Tips to help you negotiate your price

1. See your price from your client’s point of view

Step inside the shoes of your client for a moment and think about her fears – does she know she can trust you? How does she know you will deliver good value for money? Will you make her look stupid for buying from you?

Make sure you understand exactly what she wants and what she expects to receive from you. Invest time in educating your client how you operate.

2. Plan in advance

Make a list of what you have to negotiate. What will your customer insist on and how flexible are you prepared to be? Can you offer delivery before or after Christmas? Can you offer a six month or twelve month warranty … or would he prefer a monthly contract? Look for solutions, not problems, and keep thinking creatively. Ask him: ‘Would you prefer this or what about that?’

3. Make sure you are dealing with the person who has the authority to say yes

If possible, find out how much discretion the person you are dealing with has, and who else is involved in the purchase decision. How are you going to sell them anything if the person you are dealing with has no authority to buy?

4. Don’t mention your price too soon

Get your client thinking about what you are going to give her before you start her thinking about what she’s going to have to pay you. Build her confidence and reassure her that the quality will be just what she wants and make sure it is, or let the client go.

5. Test them

Tell your customer what others are paying and how happy they are with your products and service. Then test your customer by asking: What were you expecting to pay? How much are you paying now? What are your usual rates? Is there a company policy on this? What did you pay the last person?

6. Sandwich your price between benefits

When you tell your customer how much it costs tell her the significance of all that she is getting and how it will benefit her.

7. Compare the product quality to the price difference

If you are making a comparison between your own products and services, or those of a competitor, tell your client all the extra special effort, or components, you put in. Remember: It’s not the price that’s important it’s what the product does for her.

If your product or service is higher priced don’t be afraid of the competition. Be proud. You are better. Likewise, if you are cheaper – be proud. Tell your customer how and why you made it cheaper, and what the benefit of this is.

8. Show the penalties of not buying

What might she miss out on if she doesn’t buy now? Show the savings - gross them up or show them as extra profits if they are reselling your goods.


9. Explain the cost (or the savings) in a way that is meaningful to your customer

Reduce the expense into smaller units e.g. $520 extra is just $10 a week; $1.42 per day: a few cents per hour. If it’s a large purchase you can work it over the lifetime of the product.

Compare the value of your deal: What else could they spend their money on? Put it in their language. For example, the cost is less than one meal out. You only need to make one sale to cover it.

10. Create some urgency

Motivate your customer to act quickly. Make them an offer, for example: Buy one and get one free; Free gift with purchase; Extended five year warranty.

Focus their attention on deciding now, not later. Give them a deadline on the offer. ‘Offer valid until [date].’ You don’t want them to procrastinate any longer.

Related Articles
  Stress-Free Selling® - Stop Giving Deals!
  Manage Your Salespeople by Working Smart, Negotiate Quotas
  Negotiation Checklist to Ensure a Successful Outcome
  Extended Warranties: Sensible Insurance or Waste of Money?
  Objections are Requests for more Information

Article Tags: christmas, confidence, discretion, fears, money, person 6, point of view, product quality, purchase decision, sandwich, shoes, warranty



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Re: How do you negotiate your rate or price? - [quote="BuzzAroundBooks":28xzyavo]Just as an update, I've decided to take a tutoring position for less than I originally asked for. I figure I'll work at the lower rate to start and then prove that I'm worth the higher value by delivering results for the first client. Any tips on when to try to re-negotiate my price?[/quote:28xzyavo] This is something I always struggle with. In some instances you can use an "introductory price" and then raise it after a limited time. Donna
Never Neogtiate Price - I hate negotiating on price - like everyone else I'm sure. I'd rather find a part-time job to pay the bills than negotiate on price. When i did websites i made sure that I invested more time with the customer in the concept stage and in getting to know them a bit more. That investment in time in the early stages made them more comfortable to deal with me rather than another designer with cheaper prices because i gave them a sense of comfort that i knew exactly what they wanted and i would deliver. That comfort and trust i built was something you couldn't put a price on and it demonstrated higher value. I learnt this from a "Webdesign Business in a box" book I had purchased from Sitepoint. Aside from jumpstarting my Web business it also taught me some great interpersonal skills I still use today. Best investment I ever made.
Re: How do you negotiate your rate or price? - Just as an update, I've decided to take a tutoring position for less than I originally asked for. I figure I'll work at the lower rate to start and then prove that I'm worth the higher value by delivering results for the first client. Any tips on when to try to re-negotiate my price?
Re: Matching competitors prices - beware - While I agree that getting into a price war should be avoided if possible... on rare occasions, it's not a bad idea to match someone's price (or even beat it) if you're doing it "one time" to land a new customer. For instance, I was recently looking for the best price on a [u:2rhwa2wg]specific[/u:2rhwa2wg] flight to NY and a customer service rep from Flight Centre ended up taking zero commission to help me book my flight. In fact, she even beat the price by $5 in the hopes of creating brand loyalty for the future.


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