Yes, there are some rules of pricing, particularly if you are taking a price increase.
You know you have to increase prices with a customer. If you do it correctly, you’ll protect your profit and continue to provide the customer the value they want.
Here are 9 things you should NEVER do…
- Never “ask” for a price increase. Why would any customer offer to pay more?
- Never blind-side your customer with a new price.
- Never hide behind a price increase by letting it be communicated in an invoice, letter or email.
- Never try to justify a price increase using only the cost of raw materials.
- Never make a commitment such as, “This will be the only price increase for the next several years.”
- Never mask your price as being part of an industry trend.
- Never lose your ground by not knowing in advance what your “walk away” point is.
- Never allow the price increase discussion to become an emotional issue.
- Never call your price increase a “surcharge” of any type.
And here are 8 things you should ALWAYS do…
- Always “tell” the customer what the new price increase is.
- Always support the price increase based on the “value equation” of what the customer is receiving.
- Always provide lead-time to the customer.
- Always tie the price increase to the continued technical, quality and confidence of what you provide.
- Always respond to a pricing objection you’ve heard twice with a question about a critical need the customer has. Remember this is the reason why the customer needs to buy from you.
- Always present the price increase as an investment.
- Always communicate the new price with confident body language.
- Always have the pricing strategy developed before beginning the process.
“The customer will never pay you more than you tell them to.” – Mark Hunter
Copyright 2015, Mark Hunter “The Sales Hunter.” Sales Motivation Blog. Mark Hunter is the author of High-Profit Selling: Win the Sale Without Compromising on Price.