This week’s blog is going to be short and sweet. Over the years I have come across a fair few people who, in order to win business, will negotiate on their price. They will not present their value and thereby won’t justify the investment, so will start compromising with the potential customer just to get them to take on the product.
This is quite common in service based businesses. Here is a video looking at the idea of negotiating down your price in other business contexts which really emphasises its importance and why you shouldn’t really accept people doing it.
Give yourself a little wriggle room
One way to avoid this is by giving yourself wriggle room to negotiate but never going below a threshold that covers your costs and keeps your margin. Winning the business can blind you to this sometimes, however in the long run this is only detrimental to your business moving forward. It is important you give yourself an absolute minimum price that you won’t go below. Without it you will struggle to sustain your business.
Demonstrate the value
The important thing is to demonstrate the value to the buyer, highlight the benefits and show them how it suits their needs. By doing this, you will be able to ask for the price you need to make your business a success. If you ever find yourself negotiating down, think back to this video and say to yourself, “This is not right, if this person does not want to pay then I haven’t highlighted the value to them yet.” Then go back and demonstrate the benefits of your product and how it suits the needs of the buyer.
There. Short and sweet. Happy selling.