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It’s not hard to find contractors who think they are losing jobs because their competitors have a lower price than them. How many are losing jobs because they lower their price instead of standing firm?
That is a question that is much harder to answer — especially since most people do not want to face the truth. Here are five reasons that lowering your piece could cost you sales.
1. You look like your competitors.
Do you really think that having the lowest price will make you stand out? Every other salesperson says the same thing. Everyone claims to have the lowest prices because they think it will get the customer’s attention. Even if it did make you stand out, it would be for the wrong reason — the very wrong reason of offering a watered-down version of what people really want.
2. It takes focus off your customer.
Price does not determine the sale; your customer does. That means that your attention should be completely on them. Customers search for a product that is the best solution to their problem. They understand that a service cannot be the lowest priced and still be the best. Making the sale requires that you find the best solution, not the cheapest.
3. It decreases perception of your value.
Before every purchase, a customer considers, “Is this worth it?” The answer depends on the value of the product, not the price. If they envision themselves using and benefiting from the service or product, the answer is yes and the purchase is made.
4. It brings your integrity into question.
Customers will not buy from you if they don’t trust you, and they definitely won’t trust you if they feel that your price is dishonest. Lowering the price of your product suggests your product was not really worth what you were asking for to begin with. They will believe you are padding your price.
5. It leads to buyer’s remorse.
Customers want to feel confident in their purchase and know that they received the best value for their money. Lowering the price for your customer puts them in a situation where they feel haggling is necessary. They will question their purchase and wonder if they should have pushed you harder to lower the price.
A Limited Strategy
When you lower the price of your product, you are limiting your sales strategy to a dollar amount. Price becomes a dominant part of the conversation ONLY because YOU have allowed it.
Focus your attention and sales presentation on what really matters: the customer, the value, the uniqueness of your company and your product. When these things are put first, price will always come in second.