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Life Health > Running Your Business

Don’t Play the Price-cut Game

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Some organizations train their buyers to negotiate more than once, each time taking more and more out of the deal. These buyers subtract value instead of adding it. First you negotiate with your main contact, then he brings in purchasing, then purchasing brings in the CFO…

By spreading out the subtraction of value (always from your end), you give up more than you otherwise would. You get sucked in. You get emotionally invested. You feel that you’re so close. You don’t want to give up now. (Sound familiar?) This is a negotiating tactic. To combat this tactic, simply refuse to play. Instead, negotiate once and only once.

Once price negotiations begin, negotiate. Once your dream client begins to negotiate, you have to decide whether to engage or withdraw. If you are going to negotiate, you have to be certain that your negotiations are final. Whatever you agree to must be binding, and your clients must agree that they will buy at the conclusion of negotiations. You have to be willing to ask “If we are negotiating price, are you committing to buy upon our successfully reaching a deal?”

If the answer isn’t “yes,” or if you doubt your clients’ commitment, you must ask the following question: “Who else is going to be involved in this negotiation?” If purchasing or some other professional buyer is going to be involved, now is the time to bring in the other decision-makers. You want to be sure that this is your one and only negotiation. Or, alternatively, don’t negotiate at all.

Simply withdraw. If your contact suggests that there are going to be further rounds of negotiation, don’t play. If you do play, you will end up with a lower price than you need, and your clients will end with a poorer result than they need. Tactics to lower prices may work, but they don’t do anything to improve execution. Instead, they make it more difficult to produce results because they strip out the profit motive necessary for delivering those results.

Instead of engaging in a negotiation, be honest and say something like this: “I think negotiating price now is premature. Our efforts are better spent figuring out how we put together the best value-creating solution we can, and then we can negotiate once we have done that.”

Do what’s right for you and your dream client: Build the best value-creating deal that you can, and then—and only then—negotiate your price.

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Anthony Iannarino is the managing director of B2B Sales Coach & Consultancy, a boutique sales coaching and consulting company, and an adjunct faculty member at Capital University’s School of Management and Leadership. For more information, go


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