Responding to an Uncomfortable Sales Situation About Pricing

You knew this day was coming, but that doesn't make it any easier.

The phone rings and it is an existing customer of significant size. They are taking you out to bid. Perhaps it's because someone in accounting believes that too much money is being spent on print or perhaps because the key contact of yours has departed and a new one, anxious to make an instant financial impact, decides to test the waters and get different pricing. Whatever the case, this is an uncomfortable sales situation and one unlike any other.

Chances are, better pricing is out there. And chances are, you are about to get called on the carpet. Are you squirming yet?

Assuming that you are not gouging the customer (in which case, your best bet is to disappear and join the witness protection program), you are going to have to answer to a discrepancy. Sure, you could certainly beg for the opportunity to "sharpen the pencil,” but doing so is an admission of overcharging.

Instead, why not just seek to prove your value and justify the price difference by pointing out the successes you've had, the delivery miracles you've pulled off and the solutions you have brought.*

I remember this situation happening to me years ago. I was two or three years into the relationship and the buyer absolutely hated me. I had deep connections with the Technical Writer and the directive to buy from me came from her. One day, he gave me a printout of my grid pricing and said that I was 40% to 50% more expensive than like competition and demanded an updated price list.

I took my price sheet from him, borrowed a red pen, crossed out the date at the top of the page and inserted today's date and then handed the page back to him. He was a cross between angry and confused and asked me in somewhat colorful language what was happening.

I told him that my prices were the way they were and that I was not changing them. I told them that I had never missed a ship date.* I reminded him that the previous vendor was so bad in this category that the company missed key ship dates of their product and their stocks suffered as a result. Each time this happened, the company lost millions of dollars.

I shrugged my shoulders and said, “Isn't that worth paying 40 to 50% more?” With rage in his eyes, he stormed past me.

Dropping your prices can only be seen as an admission. While this is the situation that you need to prepare for, it's not likely that you're going to win just by providing lower costs. Stand up for yourself and prove your worth.

*And shame on you/me for not doing this along the way. This unfortunate and uncomfortable sales situation could've been avoided had you done so!

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