Graham McGregor: How to handle price objections

Business is a game of two halves and in the first half you create superior customer value and in the second half you have to sell that value. Photo / Supplied

Opinion

Some of the most common objections we hear in business are ones that involve price and money. Clients and customers ask us to give them a discount or they tell us they can buy our product or service much cheaper from other suppliers.

So how do you handle these price objections without having to give away your hard earned profits with expensive discount?

To answer this question, I had the pleasure of interviewing best selling business author and marketing expert Dr Ian Brooks.

Ian is the author of 16 best selling business books, and one book that I really like is called How to persuade your customers to pay more.

I asked Ian for some tips on how to handle the price objections that we all get.

Ian explained that business is a game of two halves and in the first half you create superior customer value and in the second half you have to sell that value.

Ian commented that many of the people, who think that they have to compete on price, do this because they haven't created any significant value in the customer's eyes in the first place.

Ian gave me some wonderful examples on how to do this in our interview.

Ian was working with a company in that sells automotive paint and they came out with an innovative primer for small repair jobs that panel beaters could use.

It was in a spray can and you sprayed it on the job and under UV lights it cured in about 2 to 3 minutes. Well most primers take around 1 to 2 hours to cure so right away you can see that the cost saving by having a fast-curing primer.

But this primer also solved some other problems. If you sprayed it onto a part of car that didn't need to be repaired it would just wipe off whereas other primers stick and then you've got a major problem. So now you could have the 15 year old apprentice at $15 an hour doing the work rather than the expensive tradesman at $35 an hour.

Also why do young apprentices join the panel beater? Because they want to paint. And what don't you let them do for 2 or 3 years? Paint.

So they get fed up and leave. But now with this kind of primer you can get them involved in the painting much earlier and that motivates them and keeps them longer.

So you see that one little tin solves a number of problems and every time you are solving a problem you are saving a customer money. And we start adding all these things up. Then all you need the customer to see is that what they are saving is far greater than what they are spending.

Ian went into a lot of detail on how to handle price objections and why we had to learn to sell the value of what we offered. This is one of the most important lessons we all need to learn in our business.

Action Step:

If you ever have clients or customers asking you to for a discount or telling you they can buy what you offer cheaper elsewhere, I recommend you read my complete interview with Dr Ian Brooks. Ian explains how to sell the value of what you offer so your clients can clearly see that the cost of your solution is far less than the cost of their problem.

The practical ideas in this interview could easily be worth thousands of dollars in new profits to you when you use them.

"Price is what you pay. Value is what you get."
Warren Buffett

www.theunfairbusinessadvantage.com (This is free and has now been read by business owners from 11 countries.)
You can email Graham on graham@twomac.co.nz

Graham McGregor is a marketing consultant and the creator of the 396 page Unfair Business Advantage Report.