Marketing and Sales

"Your Price is Too High!"

Why do your customers tell you "your price is too high"?

Do they really know one way or the other if your price is too high? Consider this. If your customers did in fact know that your price is or was too high on any given price quotation that you have given them, you and your company would not be necessary. They would do the work themselves.

"Your price is too high" is a tired old line that your customers have been trained to use to get you, the contractor, to lower the sales price of your work. They have been told by the media, their neighbors, someone at work, their family, whoever that if they tell you "your price is too high", you will, in all likelihood, change the quotation to some lower number. You will do this in hopes of getting their job. That is exactly what most "order takers" will do. The good salesperson knows better and doesn't lower their price, unless the customer changes the job.

"Your price is too high" (and that statement can come in a number of different forms) simply means that you have not done your job as a salesperson. Plain and simple, you have been lazy and have missed some very important steps of the sale.

You have not pinned down the budget to the point that you know what they want and are willing to spend. We outline this procedure in our Profitable Sales video, our book, "Profitable Sales, A Contractor's Guide", and also in our book "Markup & Profit; A Contractor's Guide". To get a "Yes" when asking for the order, you must get the four basic questions answered.

Those four questions are:

1. What do you want to do?
2. When do you want to do it?
3. Who will make the buying decision?
4. What does that person(s) want to spend?

If you get the answer to those four questions, you will get to "yes" much quicker.

Sticking to and getting the answers to those four questions will help you determine if your customer is in fact qualified to buy from you. You will also eliminate most of the so-called "sales objections".

Knowing the answer to those questions will take your sales ratio from 1 in 5 to 1 in 3 very quickly, without lowering your price.

Learn the technique, ask the questions, get the answers and watch not only your sales increase, but your profits increase as well.

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President

Eric

My experience is that 87.3% of statistics are made up.
The above statistic has a 4.65% margin of error.

No real contractor is going to reduce his price at all.
If you want a lower price, reduce the scope of work or change your product selections.
Eric Lamascus
www.DiscoverElite.com

Was this comment useful?(30/53 people think so.)

Researcher-50% less

JP Ware

Researcher(it would be nice if you used a name it would make your comment more credible). I would be interested to see the supporting data for your comment, further to look at the statistics of the "60%ers" who are still in business within, 6mos, 12 mos, 2 years and 5 years after accepting 50% less for their work. My bet is if the "60%ers" are doing an accurate bid that is reflecting their true costs combined with a properly calculated margin to cover their overhead and required profit, you will find that less than 10% of them are still in business after 5 years. Businesses need to make money to survive, the Internet mentality of Amazon and the likes operating at little or negative profit have fooled the buying public into thinking this NET LOSS business practice works and that it applies to the real world brick and mortar businesses that are the backbone of the economy.

Was this comment useful?(50/106 people think so.)

Dude

"My experience suggests that 60% of the sellers are willing to accept 50% less"

That's the dumbest thing I ever heard.

Sellers of what, crack?

Was this comment useful?(52/101 people think so.)

wow.

Nathan Deneault

Obviously the person who commented on taking a 50% discount is full of it.

The cost of doing business keeps going up. How in the world can a company take 50% off of the total amount? Taking 5% off hurts like heck!

Oh well that person can always dream.

Best of luck everyone!
Nathan Deneault
Atlas Coatings & Construction
http://atlascoatingsandconstruction.com

Was this comment useful?(54/108 people think so.)

Huh?

Phil Vanderloo

"My experience suggests that 60% of the sellers are willing to accept 50% less."
That's hilarious!
You made my weekend. Always up for a good belly laugh.

Was this comment useful?(59/118 people think so.)

give 2 prices

kris

i always give 2 prices there is the take it price or the leave it price and have been pretty successful so far

Was this comment useful?(201/396 people think so.)

Researcher

Gold

What if the price quoted was acceptable and the buyer said the price was too high? My experience suggests that 60% of the sellers are willing to accept 50% less.

Was this comment useful?(225/506 people think so.)