The Price Is Right Price is often the first thing on your customers' minds--so you need to think about it, too. Name your best price with these key strategies.
By Barry Farber
Opinions expressed by Entrepreneur contributors are their own.
There are very few hard-and-fast rules in sales, but here'sone that is true 99 percent of the time: If you focus solely onprice when selling your product or service, so will your customers.Unless you can distinguish your product from its competition, theproduct with the lowest price will get the sale.
Because everyone's concerned with money, you can expect tohear price objections from customers at least once in a while. Thekey to avoiding objections is making sure customers know whatthey're getting for the dollars they're investing.
Bart McConley, a friend of mine, is the general sales manager ofthe Warnock Automotive Group, which has dealerships in EastHanover, Livingston and Morristown, New Jersey. If anyone knowsabout price objections and negotiations, it's someone who runsa successful car dealership. His take on price objections?"It's all about perception," he says. Many carsalespeople lower the price in the parking lot before the customereven gets into the car. What's the customer left to think aboutthe value he's getting?
McConley's right. Here are four things I've learnedabout price objections:
1. Sell your true value. Never apologize for the price ofyour product. Provide your price, and stand strong on it. You canonly do that, however, if you have the backup information necessaryto support your price. Always be armed with at least three keyreasons that make you unique, distinguish you from the competitionand give your product added value. Your main goal is to help thecustomer understand the true value of what you're selling.
2. Generate enough activity so you can afford to walkaway from customers who don't see your value. If you've gotjust one prospect, you're going to want to make that sale nomatter how much you have to lower your price. When you already havemany prospects in line, however, you can stand your ground knowingthat if this sale doesn't work out, another one will. Ifyou're constantly discounting your price, the perception ofpotential customers is that you're undervaluing not only yourproduct, but also yourself.
3. Know when to negotiate. If, for instance, you'reworking on a new product launch with an account, and a lower pricemight help them enter the marketplace with a greater chance tosucceed, it will also help your success in the long run. Or if acustomer is willing to buy volume, you might negotiate your price.Flexibility is based on creating ROI and long-term, profitablerelationships.
4. Be confident. In essence, your customers are askingyou, "If I'm paying more for your product, what othervalue am I getting for that investment?" It's not justshowing them the additional value they're getting for theirinvestment. More important, it's the confidence in yourapproach that makes them feel comfortable doing business withyou.
Your confidence is the most powerful tool you have when handlingprice objections. If you're confident enough to overcome thefear of losing the sale, you can remain firm in the face of anyobjection. Confidence breeds success, especially where price isconcerned.
