"Can't you do better than that? Your competitors' quotes are 15% lower than yours!"

Winning when you're the more expensive option is a challenge all of us face at one time or another. The key is understanding that behind this objection lies a request for clarification, for education, for information. In this case, the prospect may be asking, "Are you worth more, and if so, why?" Or he may be asking, "Is there something of value missing from the other proposals that would account for their quotes' being lower?" In the end, the question he needs answered is, "With which vendor will I be getting the best deal?" where "deal" means "value." When phrased this way, this objection becomes a pretty reasonable request, doesn't it? Your job as a seller, then, is to establish the superior value of your offering. If you can't do that, you can't expect to be awarded the business, let alone command a higher price.

So how do we go about establishing our superior value? We start by recognizing that "value" has two components - what you get and what you give up. Benefits and costs. The ratio of return vs. investment. As sellers, we need to demonstrate that this ratio is highest with our offering (notice that I did not say we have to have the lowest cost, nor the most benefits. It's the two in combination that matter.). To do this we must first determine the benefits that are important to this prospect, and position ourselves as the best solution for him on this basis. We accomplish this by asking questions. Discovery questions that uncover what this prospect is looking to accomplish? What set of benefits he does he consider to be important? Leading questions that get him to value benefits we offer that our competitors don't (of course, this means you have to know what your competitive advantages are!). Questions that get at what this person's agenda is - what factors influence him, what motivates him, and how will he ultimately make a decision, when all the hard analysis is over and done with (see sales tips #9, and #10, in which we discussed the complex set of factors that go into how people make buying decisions).

Having now made a persuasive case for our offering, our next task is to make an equally persuasive case that it's worth what we're asking. The good news is, having demonstrated your superior solution, your burden is now considerably lighter - you've already increased the top part of the benefits/cost ratio. Your prospect now wants to buy these benefits from you, but may still need a little extra convincing on the cost side. One way to do this is to have him consider and compare the Total Cost of Ownership (TCO) of the various solutions. If you know that the cost of owning your product or service will, in the long run, be the same as or less than that of your competitors' products or services, you need to share this with your prospect, who may only be focusing only on what he's going to have to spend now. Other cost- side benefits, he may want are avoidance of the non- financial "psychic" costs such as less worry, and the lower risk that comes with working with you and your company.


Now, will this approach eliminate all haggling? Of course not. It is human nature to want to get the best deal we can. But by using this approach, you'll be better able to maintain price integrity, while at the same time out maneuvering your lower-priced competitors.

ACTION ITEM

Pick a deal you're working on where price is an issue an ask yourself the following questions. Have I established my product's or service's superiority by aligning its benefits with what's important to my prospect? Have I established the advantages I provide vis à vis the lower priced alternatives? Have I established investment superiority by demonstrating a lower Total Cost of Ownership. Have I established a lower psychic cost to doing business with me and my company? If not, go to it! For once you've done this, your prospect will see clearly that you have a solution that is worth the extra up-front investment - an offering that will allow you to turn the tables on your low-priced competitors. And now your prospect (if he isn't already sold on you), has to go back to your competitors and ask the same question of them as he did of you - "Can't you do any better?"

And this time, he doesn't mean price!

Good Selling!