How can you successfully implement price increases?Posted on 07/14/2016 in Selling Skills
Salespeople vary tremendously in both their confidence and ability to implement price increases. Below are some guidelines to help you prepare and deliver the rationale for a price increase.
Pre-Call Planning Guidelines for Price Increases:
- Make sure you understand the relevant market information about the price increase. Use this to justify the price increase.
- List the two or three strongest reasons that you will cite to a particular customer. Be factual and be concise. You don’t want to overload the customer with too much information.
- Know your pricing history with this customer. How long has passed since the last price increase? The customer may not realize that their price has not increased for quite a while.
- Can other people assist you? Two examples: 1) Role-play with a colleague or manager. This allows you to receive feedback, fine-tune what you will say, and ensure that you are presenting yourself with confidence. 2) Determine if a joint sales call would be appropriate. This would be done selectively, such as with certain key accounts.
Sales Call Guidelines for Price Increases:
- Present the rationale for the price increase. As cited above, be concise. It is better to give the two or three strongest reasons for the increase rather than give too many reasons.
- Communicate with confidence. Avoid words and phrases that weaken your message. It isn’t just what you say, but how you say it. If the customer perceives a lack of confidence, they will take advantage.
- Cite the value that you have provided to this customer such as superior product breadth and 24/7 customer service. Remind the customer about any problems that you solved for them. For example, an emergency delivery you personally took care of last year.
- When encountering resistance, ask questions to understand fully. Don’t concede too soon. Don’t concede on price as your first action. If you have to make a concession, make it on a non-price issue. For example, “I can’t reduce the price but we can extend your warranty for an extra 90 days.”
Contact us if you are interested in discussing a customized sales workshop for your team that includes a module on price management guidelines. One-on-one sales coaching is also a great way for individual salespeople to improve their skills at successfullly implementing price increases.