Last week I had the opportunity to visit several dairy farms with a sales rep (we’ll call him Bill) in the agricultural industry.
During our final sales call of the day, Bill was talking to a customer with whom he wanted to secure more business. He only had a small share of this farmer’s business and he knew there was lots of potential.
Bill asked the farmer some good questions, listened to the responses and made some good suggestions. However, instead of using his knowledge to increase his value proposition, he quickly offered a significant discount to capture the business.
What really stood out to me was that the farmer never once questioned the price of the product.
After our sales call, I coached Bill and suggested that he ask a few more questions to gain additional insight into the farmer’s buying motives and that he wait for the other person to request a discount or price break instead of automatically offering one.
Price is a factor in every sale…I will never, ever deny that.
However, it is seldom the primary reason behind someone’s buying decision unless the price of your product is way out of line with the industry norm.
When you offer discounts without being asked, you set the expectations for future sales opportunities with that customer and limit your ability to sell your product at its full value. Not only does this erode your profit margins and commissions, it discounts the value, knowledge and expertise you bring to the table.
Before conceding to a discount think about the impact it will have on your business. Make the other person work for any and all concessions. Resist the impulse to offer quick discounts. And above all, don’t give away the farm in order to capture a sale!
Avoid 32 negotiating mistakes that cost you money. Download our latest eBook here.
By Kelley Robertson