The Zen of Price Negotiation
When we say negotiation, we mean the process of discussing and compromising of two or more parties to agree on something. In business, one’s goal would basically be either to sell or to buy. And since everything comes with a price, that’s the first and foremost thing that gets to be negotiated – the price of goods, of services, of rent, of labor, etc.
To make things simple, we’ll divide negotiation into two parties, the one who wants to sell and the other who wants to buy.
Read on to learn about basic negotiation tactics.
The Seller
Every salesperson wants to close a deal. But though you’re dying to do so, do not easily give in to the customer’s price negotiations. As what negotiation guru and author Ed Brodow said, be prepared to defend your price or your customers will think lowly of you.
Why? It’s because if you don’t stand firm by your price, your customer will think that you can afford to lower your price so much that the real value of your service is really far less than your price.
Don’t think that if you refuse to lower your price, your customer will immediately look for your competitors. Refusing to negotiate might actually give your customer the impression that you probably have something worth spending for that you risk losing a customer to your competitors.
Be confident. Justify your price and emphasize your strengths and the benefits the customer could get if he/she buys from you.
This, however, does not mean that you should never budge and negotiate the price. Let your customer make concessions. Lower your price or offer a discount only if the customer would order more or the merchandise you gave is flawed.
The Buyer
As a buyer, you only have to make these two things meet: your budget and your needs. You have to get what you need by using as little of your budget as possible.
If you’re a regular customer, you can bank on that fact and ask for a regular’s discount.
Try to squeeze your seller for a lower price by negotiating what other features you might remove from or add to your deal. Tell them how much your budget is and they might be even able to lower their price accordingly or help you spend it for their service more efficiently.
Related Articles:
- Show Me The Money: In business, everything has a price
- The Stock Market for College Entrepreneurs
- Why You Shouldn’t Compete on Price Alone
- Buying and selling blogs podcast
- Large Scale sites = good value for buyers
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