When Negotiating Price, Don't dribble. Go for it!

Consider this BUYER/SELLER Scenario:

“Tim, that’s a really fine product you have,” responded Joanne.

“Well, I certainly appreciate hearing that,” responded Tim figuring that in the next moment or two, she was going to make up her mind about buying. He continued, “Many others in your profession have felt the same way.”

“Oh,” she said, “then this isn’t new?”

“Not at all. For the past ten months, this policy has really made an impact on how our clients reduce in-house costs.”

“That’s interesting. I wish you had contacted me sooner. I thought this was brand new.”

Ah, thought Tim, I’ve heard this objection during the past three months over and over. I’ll use the same approach that’s worked before.

“My company made the decision to bring this new product to the table as your old policy came up for renewal. No point in upsetting something in place.”

“Tim, don’t take this the wrong way. You weren’t the one who sold me the previous policy, but I find your company’s decision to handle it in this fashion a bit annoying.”

Here comes the “I could have saved money” comment, he thought.

“If I understand what you’ve laid out, my cost for the new program is about 30 percent less than what I currently have.”

“That’s correct, 32 percent to be exact.”

“If I had be informed of this new policy earlier, would there have been any added charge or penalty to switch from my current policy?”

She’s sharp, he thought. I should have kept my mouth shut. Why does this always happen to me?

“There would have been what we call a ‘Policy Change Adjustment Fee.’”

“Roughly how much would that have been?”

“I’ll have to get back to you on that. The calculation is a bit complicated.”

The RESULT:

Tim should have asked, once he thanked Joan for her compliment, “What would you like to do now?” Instead, he kept dribbling out words that dug him deeper and deeper. Will Joanne want to buy from someone who cost her money by holding back on a way to save? Doubtful.

DISCUSSION:

You don’t win basketball games by fancy dribbling. You win them by putting the ball through the basket. You don’t win baseball games by standing on a field. You win baseball games by swinging at the pitch. If you don’t score, you lose.

Most shots at the basket fail. Most swings at the pitches fail. Babe Ruth struck out more times than he got hits. Yet he is considered one of the greatest. Could it be said he failed more often than he succeeded while at bat? Sure. But he wasn’t considered a failure.

Of course, you’re right; it’s all a matter of knowing what counts. What counts in sales for a salesperson? The number of appointments made? The number of presentations made? The number of sales made? The amount of money a salesperson puts in the bank?

If you think anything else other than the last one is what matters, then you are a dribbler, someone who admires fancy footwork. Now, a sales manager may consider the number of sales to be most important, but you aren’t a sales manager.

APPROACH:

The worst that could happen by asking for the order is that the prospect says “No.” If this is a real “no” and there is no chance of doing business, the sooner you hear it, the better, so you can move on. But before you cross her off your list, give her a chance to change her mind.

“I guess we’ll never do business.” You have relieved the pressure on the prospect. She’s relaxed.

“Could you answer one question for me?” Sure, why not. The pressure is off, and as soon as I answer this question you are gone.

“When we first talked, there must have been something about me or my product that interested you. What was it?”

Now the prospect is mentally reviewing everything from day one. In short, she’s mentally reopening the door to doing business. Almost in every case, she’ll come up with something positive. “Well, your pricing and coverage are much better than our current agent’s.”

“I’m a little confused. I have better pricing, better coverage... and that means we shouldn’t do business?”

What’s a prospect to do? Give the answer to the questions and kick the door open to doing business.

THOUGHT:

Money is made by those who ask for it.