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“Discountitis” is fast spreading like a virus among salespeople. It is a sickening condition which renders a sales agent unable to secure orders at the normal price. At the slightest hint of price objection, the sales representative will immediately discard his ace right under his sleeves --- discounts. 
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Discountitis” is fast spreading like a virus among salespeople. It is a sickening condition which renders a sales agent unable to secure orders at the normal price. At the slightest hint of price objection, the sales representative will immediately discard his ace right under his sleeves — discounts.

Time and again, whenever I am asked to conduct sales training, company owners, Presidents and Sales & Marketing Heads will tell me, “Our people know very little how to handle price objections.  They seem to think that without giving a huge discount, the product or service can hardly be closed.”

I can’t help but recall one company where I’ve conducted a sales training program. In order to simulate a real situation, I asked somebody to play the role of the prospective customer and another to play role of the customer service representative or salesperson.  As a matter of course, the “customer” inquired about the various services of the company and then the price of the one she liked the most. The “salesperson” with much enthusiasm explained the different packages and then told the “customer” the price.

When the customer showed reluctance and raised concern about the price, immediately and without batting an eyelash, the salesperson offered a whooping 30% Discount.  I could see the very upset reaction in the eyes of the General Manager. If her people would dispose this way in her presence, the more they would do so in her absence.  Her people would offer discounts left and right at the expense of the company’s profit margin.

Experts agree that product knowledge is not enough.  As Todd Duncan once said, “Trying to sell without training to sell is a fatal mistake.”

How do you handle requests for discounts?  How do you handle price objections? If you are leading a group of salespeople, you should see to it that your people will internalize them.

1. Before Answering Your Customers’ Price Objections, You Must First  

    Answer Your Own.

If the salesperson himself believes that the price of his company’s product or service is too high, he will not be effective in handling the price objections of the customer. I believe this is very essential.  In the words of Martin Shafiroff, “All great business successes have strong convictions in what they are doing.  Essentially, the first person you must sell to, if you want to succeed, is yourself. I believe this is vital.  When you believe in what you are doing, the other party evaluating your comments is going to react accordingly.”

Along this line, business owners or sales leaders must make it a point to give a product orientation to their people.  The purpose is not merely to explain the products but more importantly, to convince them of the value of the products.  This can be done once in a while or during sales meetings.  Remember, if the salesperson is sold himself, then he will not easily cower even under a Herculean pressure.

2. Remember, Many Ask For A Discount Or Raise Price Objections Merely As A Force Of Habit

Studies show that many who ask for a discount do not expect that their request will be granted. As Kelley Robertson has put it, “Recognize that people ask for more than they expect to get.” Believe it or not, a lot of prospective customers are just giving it a try

With or without a discount, they will still buy anyway. Unfortunately, many customers are far better than the salespeople when it comes to sales presentation or negotiation.  The customers present with more conviction (i.e., the plausibility of a bigger discount) compared to the way the salesperson presents the value of his product.  That is why, the stark fact is that it is the salespeople who often get the shorter end of the stick. 

3. Even If You Have To Give Discounts, You Must First Defend The Price You Have Initially Given. 

Picture this in your mind. Suppose, for example, that you are looking for a second-hand car and I come to your office to offer my Honda Accord. Let’s just say that my initial offer is Php400K.  Smirking, you shot back with, “Come on, just give it for Php350K.” To your complete surprise, my immediate reply is, “OK, Php350K. Deal!” What would you feel?  Even if you got what you asked for, you would still feel short-changed, right? 

 If, instead of giving in immediately, I replied, “You know buddy, I could really sell that car even for Php450K – 475K if I were not in a hurry.  I just need money very badly now.  But with its well-maintained engine, new seat covers, etc., etc., Php400K is a jackpot for you.” Now, you may still try to haggle down the price.  I may just repeat my justifications but if I have to, I will say, “OK, just to finish the whole thing.  Let’s settle for Php375K (and I look a bit upset). Even if you manage to ask for more concessions and let’s say, you’ve succeeded to scale it down to Php350K, what would you feel? You’ll get the impression that you’ve bought something valuable, don’t you agree?

4. You Should Use Some Effective Techniques To Win In A Sales Negotiation 


The next time you find yourself entangled in a negotiation, do not use a knife while your opponent is using an M16. Allow me to offer a few techniques you may find useful.  To make it easy for you, I will use alliteration – they all start with the letter “S”.

(a) The first is called the SURPRISE technique. 

As the title suggests, it is a visible reaction to the offer or counter-offer of the opponent.  If somebody asks for a big discount, for example, instead of appearing calm and composed, you make the other person uncomfortable about his offer by appearing shocked and surprised.  

  “What! 30% Discount!” “Wow!”  Unless the other person is a seasoned negotiator, he will lower his expectation for a 30% discount. 

 (b) The second is called the SUMMARY technique. 

Price objections are raised because the prospects fail to appreciate the value of the product. He looks at the price and it looks far bigger than the benefits the product offers.  Your role as sales professional is to make him see again and again the benefits of using your product.  Here, you can make a brief recap about the different advantages and benefits of your product or services (e.g., safety feature, savings, etc.).  “Mr. Prospect, you did say you wanted this feature.  Likewise, you mentioned it would meet the objectives of your company if the quality is . . . ?   Moreover . . .” 

 (c) The third is called the SLICE technique. 

You can break down the price into smaller units. Let me illustrate. Suppose, for example, that you are selling an equipment worth Php96,000 with a lifespan of ten years.  Instead of talking with the prospect about the astronomical amount of Php96,000, you can talk to him about his investment per year which is only Php9,600.  Then you can further break it down and tell your prospect, “This equipment will definitely increase your profits (or reduce overhead costs) year after year for a very small investment of Php 800 a month.  Makes good business sense, don’t you think so?” 

 Here’s how a real estate salesman may deal with a prospective client who is currently renting an apartment for Php18K a month.  If Mr. Cruz is really interested in buying house with a monthly amortization of Php34K but raises price objections, the real estate salesman can respond with (just focusing on the monthly amortization), “Mr. Cruz, what we are talking about here is the fulfillment of your dream for your family. Your investment here is only Php34K a month. Considering your monthly rental, it means that we are talking of an investment of only Php16K a month or Php4,000 a week or less than Php580 a day.  Mr. Cruz, for Php580, will you deny your family a house they can call their own?” 

 (d) The fourth is called the SUBTRACTION technique. 

We have a saying, “You will only know the value of a person when he or she is gone.”  This is true in romantic relationships, right? (I am not an expert here, haha!).  Guess what?  This principle applies in sales presentation, too. In order for your prospect to appreciate more the value of the benefits of your product, try “removing” them (mentally).  

 So, one of the first things you can do is to determine the features that your prospects like the most about your product then “remove” them.“  Sir, this product has this AAA feature which guarantees more production in your poultry. If it didn’t have this system like in many other products today, the price could be reduced. But do you want this product without the AAA feature?”   

 As you can see, sales negotiation techniques are used to lower your opponent’s expectations or justify your price. No, your people don’t have to be the next victim of “discountitis” if you will exert efforts to train them and make them see the value of your product.

Rene Espinosa

Rene Espinosa

Rene Espinosa, the President of Powermax Consulting Group, Inc., and the President of Advertising and Gaming Fabrication, Inc., is an energetic, enlightening and entertaining motivational speaker and sales trainer. He has been featured in sales conventions here and abroad and has conducted a plethora of public and in-house seminars.  

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