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How to approach when price is the issue

Hi all,

This is my second post in this wonderful forum.

i work in a software services company in India. often, when talking to prospects, the issue of price always springs up. Though i'm confident of my company's abilities, i tend to lose many leads due to the price factor. .

How do i pitch in with my services when price is the main issue?

thanks - by deadlyminds
What about the price is an issue? Can they get the same product for less? Is your price out of their budget? Or is it something else? - by AZBroker
How do i pitch in with my services when price is the main issue?
Who is saying that "Price" is the main issue? How to they communicate this to you? - by SalesCoach
What about the price is an issue? Can they get the same product for less?
Yes they can get the product (service) for a lesser price...

Who is saying that "Price" is the main issue? How to they communicate this to you?
Ususally the customer makes this known to me during my initial engagements with him. Usually it's upfront or it is pointed our sarcastically.

The problem as i said is because of the large number of competition who offer similar services (software development) at a lower price than ours. I'm not saying the company isn't incapable, but how do i as a salesman deal with clients when i'm faced with clients mentioning that our costs are too high.

I know there are ways to divert the cutomer's attention from the price. My intention is to keep him in conversation for a ceratin periond of time till he feels that there are many other things that overshadow the cost or price.

But i lose some hot prospects because of "high" price or cost without ever engaging them in a decent conversation.. - by deadlyminds
If you will approach me and I notice rightaway how ridiculously overpriced your product is when I can get the same from another company at less the amount, I will offer resistance as well. If you cannot do anything about the price, at least make it a point to deliver the characteristics of your product that makes it that expensive over others. People appreciate it when things are justified, specially the price. :) - by clarise
Is your product actually overpriced or does your company back the software up with superior level of service that results in the higher investment? - by golden1
It's not that our service is overpriced; in fact it's very competitive.

The problem is that a lot of small firms have sprung up which offer ridiculously low prices to develop software which we know for sure won't cover thiewr overheads.

Clients usually have stayed on and have appreciated our level of service and work and price was not an issue at all.

It's only for specific services that i have to negotiate over price. However my job is only to sell and not bargain price reduction with my higher - ups.

What best can i do to sell other things such as value over price, from my personal, salesman point of view? - by deadlyminds
What best can i do to sell other things such as value over price, from my personal, salesman point of view?
What is the difference between your offer and your competitor's offer? - by SalesGuy
say just for the discussion my product is priced at $100 and my competitors are at $75 - by deadlyminds
I run into this same problem as a writer, deadlyminds. There are always people out there who are willing to do the same job for peanuts, but, as with almost every market, you get what you pay for.

For me, it helps to have clips and links to my published work, so clients can see for themselves that I can do the job at a professional level - they aren't going to have to worry a lot about editing, or about the piece not meeting their needs.

In your case, can you show prospective clients a list of your long-term, satisfied customers? Maybe a case study to show exactly what you've done for them, and concrete evidence of how your product can perform above and beyond the cheaper alternative?

Whatever it is that makes your software better - customer service, basic performance, etc - is what you need to emphasize. There are lots of people out there who are willing to pay more for better service. The trouble seems to be finding and targeting those people. - by CarrieGee
thanks carrie, your thoughts definitely makes some sense.. - by deadlyminds
Essentially you just need to convince your prospects that the product is worth the price beside it. - by crassus
thanks carrie, your thoughts definitely makes some sense..
I'm glad I could help deadlyminds, and I wish you the best of luck with your sales!

This raises an interesting question though - how does one find and target those clients who will understand and appreciate that better services or products are worth the extra cost? - by CarrieGee
I'm glad I could help deadlyminds, and I wish you the best of luck with your sales!

This raises an interesting question though - how does one find and target those clients who will understand and appreciate that better services or products are worth the extra cost?

I have a chapter in an upcoming book devoted to this topic. It's really about marketing finding the correct buying triggers and using them in the advertising. If you'd like to see some of the article, just pm me.

Susan - by susana
Here is an excerpt from my book chapter:

Price is always an interesting issue with current customers. What’s important for you to know is do they see the value they’re getting for the price they’re paying? If not, you need to find out why. When prospects use the price objection during negotiations, it’s not the price they’re objecting to. It’s the fact that they don’t see value equal to that price. If your current customers feel they paid a fair price for what they received, then you have a good value proposition. A marketing campaign that draws the ‘best’ buyers in as prospects will help your sale people sell your value proposition. In the end, attracting the right buyer will bring someone who understands your value proposition and is willing to pay top dollar for it. It will greatly eliminate the need for discounts. Something every business owner wants to hear! - by susana
This raises an interesting question though - how does one find and target those clients who will understand and appreciate that better services or products are worth the extra cost?
You could target those customers who have shown similar buying patterns. - by fred
the price issue seems to be getting solved; here's an excerpt from a sales newsletter i subscribe:

[Copyrighted material removed per forum guidelines.] - by deadlyminds
i apologize for posting copyrighted material here. - by deadlyminds
i apologize for posting copyrighted material here.
Apology accepted. Thank you for your helpful efforts. - by Jeff Blackwell
Did you find a solution or response to the price issue Deadlyminds? - by fred
Usually potential customers will use price as an excuse to not have to buy the product or service. I would simply ask more questions, target the customer's needs and re-approach them using your product or service as a way of fulfilling their needs.

Sometimes the customer just needs to be reassured that your product or service will work and is exactly what they need. - by wlctrent
Sometimes the customer just needs to be reassured that your product or service will work and is exactly what they need.
You are right to a large extent. Often, i have found in my sales calls that the serious prospects ( qualified prospects) bring forth price as a resistance to hide behind other problems. the best approcach here would be to build the relationship and keep him in engagement. - by deadlyminds
I ran into this price problem for YEARS!!!! Finally, I got the answer from some sales training I took. First, anyone in sales should always expect a customer to make price an issue... It's human nature. Second, the key is to sell value. If a salesperson gets a prospect to truly understand the value of what he or she is getting, then price becomes a non-issue. Because when the prospect brings up price, the answer is simply... "Well, you see for yourself the value of what you're getting. The price is commensurate with the value."

If your product or service is in fact overpriced, then you'll realize that during the phase of establishing value in your prospect's mind. The truth is, the same product or service may be of different value to different prospects. The classic example is this.... If you're selling a computer with all the bells & whistles and high-end software to someone who only wants to use the internet, what you're selling isn't as valuable to them as if you were selling that same computer to a small business. - by Coda1108
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