Editor’s Note: Gene Marks is a small business management columnist, author, and speaker who also owns and operates The Marks Group PC, a highly successful 10-person firm that provides technology and consulting services to small and medium sized businesses. The Marks Group PC, launched in 2004, has grown to help more than 500 companies and more than 2,000 individuals throughout the country. Gene writes weekly online columns for The New York Times and Forbes, as well as monthly and bi-weekly columns for Bloomberg Business Week and American City Business Journals. Intuit has, on several occasions, contracted Gene to provide marketing-related services.
Ask And Ye Shall Receive
As a business owner, I was never one for asking for a lower price…until I found myself getting lower prices by asking.
Your better customers know that the reality of doing business today is this: everyone’s got a price. If someone told me to shed my clothes and go streaking across Lincoln Financial Field on a January Sunday I’d turn up my nose and sniff: “Hmmph, exactly what kind of a sick, depraved animal do you think I am?”
But suppose I was offered a million bucks to do that (and saw the cash)? Depravity…here I come!
So just watch me rationalize. “Welllll,” I’d think aloud. “It’s only for a few minutes, isn’t it? And it’s not like I’d be on national TV, right? And I’d only potentially serve a few months in prison at most. And even my wife agrees that it’s really, REALLY not a big deal at all (if you get my drift).
It may not be the same topic, but this rationalization is shared by most other salespeople when asked to lower their price. The point is….everyone has a price. As a banker and advisor to your customers you should remind them that they should always be pushing for the lowest price possible by asking, asking, asking.
For example, you’re meeting at your customer’s offices and just at that moment he’s in the middle of trying to purchase a bunch of raw materials he needs to process for a big order coming in. He’s complaining to you because his supplier’s price is too high. As his banker, it’s in your best interest that he makes the best deal possible too! So give him some advice. Tell him to ask for a lower price. Because, guess what? The supplier wants the business as much as your customer needs the materials. We all need more business. Whatever’s being asked is usually just the opening bid. Tell him that chances are the price can come down a bit. Multiply that bit times lots of pounds (or whatever the units are) over a period of time and this adds up.
Another story: My wife (who also happens to be the world’s best negotiator) got two bids to have our living room floors re-done. And of course the higher bid came from the company she liked better. Did she pay it? I think you know the answer. She just said she couldn’t. She needed a lower price. At least something comparable to the other company. She just…asked. And her favored contractor conceded.
Your customer needs to be reminded that he should always be asking for the lower price. Why? Because that’s what his customers are doing to him every day, aren’t they? I find it incredulous, shocking, outrageous and downright insulting when, after clearly stating our hourly fee, a client asks for it to be lowered. How dare they! And of course…I usually lower it. Why? You know why. I want the work. I don’t want my competitor to get the business. I’d probably throw in a personal car wash to get the business. Don’t look at me that way. You’re no different!
Encourage customers not to be afraid to ask for a discount. No one expects to negotiate a treaty with North Korea or haggle like an experienced merchant in a Turkish bazaar. But not paying top price is what being a profitable business owner is all about. Tell him: Just because you can afford the price doesn’t mean you have to pay the price.
Ask. You will receive.
By Gene Marks