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Negotiating the price you deserve


REALITY: You want the deal badly. You need the business. You suspect that your starting price is too high. What do you do? You lower your price rather than negotiate. Big mistake.

Most salespeople are afraid to stand by their price structure because of a single mistaken assumption: That negotiating your price will kill the deal. In fact, if you aren’t prepared to defend your price, your customer will lose respect for you. Bigger mistake.

My good friend Ed Brodow is a negotiation expert. He wrote the book “Negotiate With Confidence.” Here are eight of Ed’s tips that will help you to negotiate the price you deserve.

Tip One: You are entitled to reasonable compensation. What’s reasonable? Whatever you can convince your buyer that your  product/service is worth. The principle here is value. No buyer  will deny you a price that is reasonable relative to the perceived value of the product/service.

Tip Two: Don’t sell yourself short. Do you believe that what you are selling is worth the price? It fascinates me that some salespeople are able to bring in the order at a premium price while others can’t seem to get by without discounting. Why is this?

One salesperson gets up in the morning and says, “My product is great, and my customers are happy to pay my price.” Another salesperson gets up and says, “My product is great, but the buyer will never pay me such-and-such.” Refuse to sell yourself short and your price will follow.

Tip Three: Don’t apologize. Once you have established the value of your product/service, present your price with confidence. My friend didn’t have the confidence to ask for his full fee because he didn’t believe in it himself. If you believe your price is correct, assume your customers will agree.

Tip Four: Be willing to walk away. I call this Brodow’s Law. The willingness to walk away from a sale comes from having options. It is crucial to have other potential sales in the pipeline. When you know that your sales career doesn’t hinge on this one deal, you can exude confidence. And buyers will bow to confidence.

Tip Five: How to justify your price. Once you have decided on your price, it’s not good business to tell your customers to “take it or leave it.” You have to provide reasonable justification. Give your price legitimacy, focus on the value of your product/service and tell them you can’t lower your price for just one customer.  

Tip Six: Make the buyer work for concessions. If you appear too eager to negotiate your terms downward, the buyer will perceive you as worth less (or worthless). If you do lower your price, be sure to make the buyer earn the concession. Ask for concessions in return, such as additional business or faster payment.

Tip Seven: Qualify your prospective buyers. There are occasions where you may be wasting your time. If you think a buyer may be out of your price range, ask them what they paid for a similar product/service the last time they bought it. You may want to sell them a different item or fit them into an exception category – provided you can save face.

Tip Eight: Leave the customer feeling great. Your objective is to create a repeat customer. Make them love you without lowering your price: by being a good listener, by helping them accept your price, by providing reasonable justification and by making them feel they’re getting a one-of-a-kind.

The major obstacle that prevents you from getting the price you want is a fear of rejection. One way of dealing with this fear is to lower your price. That’s the easy thing to do, but it’s the biggest mistake you could make.

A better solution is to school yourself in assertive negotiation techniques. When you do it right, both you and your customerwill feel you’ve won.

Believe in yourself and your product or service will be your best weapon. Your self-confidence will be rewarded with a sale.

Free GitBit: Want more strategies? I’ll give you 10.5 of mine for free. Go to www.gitomer.com, register if you’re a first-time user, then enter the word “negotiate” in the GitBit box.

President of Charlotte, N.C.-based Buy Gitomer, Jeffrey Gitomer gives seminars, runs annual sales meetings, and conducts Internet training programs on selling and customer service. He can be reached at (704) 333-1112 or by e-mail at salesman@gitomer.com.

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