Offering to reduce prices on your company's goods or services is one way to make a sale, but it is not the best way to build lasting relationships. Agreeing to a discount hurts your company's bottom line and reduces your commissions, making the practice of discounting rather bad for business. Fortunately, there are several ways to make a sale without having to reduce prices or resort to other sales gimmicks.
If a customer focuses on price instead of value, there is a good chance he will ask you to reduce prices before signing a sales agreement. Prevent this by making sure your customer knows the value of what your company offers. Instead of selling the potential client on features, outline all the benefits of working with you. If you are selling a software package, for example, let the customer know how much time or money he saves by using your company's software instead of a competing package.
If you cannot reduce prices, overcome price objections by tailoring your offer to your customer's needs. Many salespeople make the mistake of offering the same product or service to every potential customer. Instead of taking this approach, talk to your customers and find out their specific needs. Once you know the customer's basic requirements, do some digging to find out if there are any custom features you might be able to include in your proposal. Many customers are willing to pay a premium for products that meet every one of their specifications.
Do not be afraid to give a potential client several demonstrations of your product. This is especially important if you are selling something at a high price point and do not want to reduce prices to make a sale. Very few people are willing to buy an expensive item if they are not given an opportunity to inspect the item or try some of its features.
Giving discounts is not always a bad thing, but you must do it properly to avoid cutting into your commissions. If you want to try discounting, reduce prices only for established customers, not for new customers. Your goal as a salesperson is to attract loyal customers to your company so they buy from you again and again. Price-conscious customers are not always loyal, even if you offer a great discount at the beginning of the relationship. Someone who bought from you because of a discount may switch companies if a cheaper price comes along.
Pricing is always a delicate issue in the sales world, but there are ways to work around it. Before you offer a discount, make sure you understand the customer's needs and give the customer an opportunity to inspect and use the product. If you decide to reduce prices, do it only for repeat customers who buy from you regularly. This helps you overcome price objections without drastically reducing your commissions.
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