The most profitable sales are those that are made before price is ever discussed. The key is to build a shared understanding of the true value of a deal, customising your proposal to match their priorities, and giving them options based on “reciprocal value”. Here’s a simple process:
Outcomes: From early in the meeting, ask what a great outcome would be for the buyer. You need to find their true objectives, so ask clarifying questions like: “why is that important?” and “what will that help you achieve?” Keep going until you’ve got clear objectives that you both agree on.
Goals: For each of those outcomes, set goals and agree how you’d measure them, or how you’d know you’ve achieved them. This will help uncover the buyer’s expectations and aspirations. At this point you can start talking about how you could best help them, or how you could flex the proposal you were going to make, in order to better hit their goals.
Value: It’s critical that you know, and agree with the buyer, what the realistic value is of them achieving the goals. If that value isn’t big, getting a good deal will be like trying to push water uphill – recognise that now and you’ll both save time and energy. If it’s very big, knowing that will help you as you prepare for the negotiation.
Close: Buyers will always push you for a price, but you need to make it clear that the price will depend on the specifics of the deal. So get clear agreement on outcomes, goals and value, and offer to send a new proposal through the next day once you’ve worked up the options. If there’s value on the table, buyers will be happy to follow that approach.
There’s a reason that sellers don’t normally work this way. Buyers are rarely clear about what they want to achieve and it’s hard, and sometimes risky, to push them for clarity. It’s far easier just to offer a discount, especially if your sellers are incentivised on sales, rather than on profit (a huge issue that we’ll cover next week).
BOTTOM LINE: Sellers that go into a meeting wondering how much discount they’ll need to give, usually lose their shirts. Instead, approach the conversation looking for ways to help the buyer achieve their objectives. Get that right and you’ll find new ways to help your customer and you’ll get to keep your shirt.