If you own or manage a small business, chances are, in order to succeed, you’ve got to be a good salesman. To be a good salesman you have to be able to deal with objections from potential customers. One of the hardest objections to handle is PRICE. This video will give you a few pointers that should improve your skills. It’s about 2 minutes long – so why not what it now?
SPEAKER 1: Postcards and door hangers are a great way to generate leads. But when a prospect responds to your advertising, one of the first subjects to come up is price. Now even the most experienced salesmen consider price objections difficult to address. So, what's the best way to handle price objections? We'll interview two experienced salesmen to see how they deal with price objections. We'll start with Sam.
SAM: Of all the objections that come up during my presentations, price is always the most difficult for me to handle. What can you say when a customer says, "No, thanks your price is too high"? I usually struggle to justify my price. When that doesn't work, I get desperate. Rather than lose the sale, I give in and lower my price. Since the boss doesn't allow me to discount, the difference always comes out of my commission.
SPEAKER 1: Yikes! That's not good. I wonder if there's a better way. Let's ask our other salesman, Harry.
HARRY: Making a sale is based on understanding a prospect's concerns. Price is just another concern. So when I hear, "No thanks, your price is too high", I realize it's usually a knee-jerk reaction. I take a deep breath, and then find out whether it's a price objection, or price resistance.
SPEAKER 1: What's the difference?
HARRY: A price objection is when the price is more than a prospect can afford. Most prospects are reluctant to admit they can't afford your offer. So you need to be a little delicate with your questioning. For example, how does the price fit with the budget you have allocated for this project? The client can then respond that the price exceeds his budget for this particular project, instead of being embarrassed about not having enough money.
SPEAKER 1: So, if it's a price objection, you can try offering terms or financing to save the deal.
SAM: I get it. If it's not an objection, it's a price resistance, which means the prospect is open to being convinced, if I can more clearly demonstrate the value of what I'm offering.
HARRY: That's right. If that's the case, you'll need to do a little digging. Has he been shopping? Is he comparing apples to apples?
SPEAKER 1: Wow, what a great strategy. Thank you, Harry and Sam. Let's review. Don't be surprised by price objections. Be prepared for them. Isolate whether it's a price objection-- where the prospect can't afford the product or -- which means that unless you can provide terms or financing, there isn't going to be a sale. Or is it price resistance-- where the prospect is open to being convinced. In that case, keep probing until you find out why he thinks the price is too high, and then address it.