That's the question. The more one discounts their products or services, the more one demostrates and reassures the customer of the lack of regard they have for their trade, and confirms for upper management a clear inability to manage profitability." Sound severe, harsh, true? If you disagree with that statement, put yourself on the other side of the table. Have you ever purchased something and asked for a discount? I hope so. Better yet, have you ever inquired about buying something and before you finish saying, "how much?" the salesperson says, "well it list for $25,000 but you could get it for $22,900". Three things go through my mind when I hear those comments, 1. the salesperson is new, 2, the salesperson is experienced and desperate, 3. the price is over inflated or the product lacks quality.

In this case, consider the purchase to be a new car. The sales person makes his or her pricing statement. You have never owned this type of make and model vehicle, but you think it is time you should. You have always bought the other brands because of quality and durability but you have heard this companies cars are making a comeback. So you investigate only to hear you can pick it up for $2,000 - $3,000 less. And all you did was ask "how much?"

Guess what? $22,900,00 is where most people will begin negotiating. The other dealerships said the price is the price. So if I get to negotiate at all. It will be from list price and if you are lucky, you might get them down to $22,900. Does this mean the customer never returns to the higher priced cars. No! When they return to negotiate they return with a new found respect for quality and workmanship. They are also hoping the salesperson will negotiate, a little. It is as if the car has taken on a whole new look in the mind of the customer.

Will the customer return to the sales person who dropped to $22,900 right off the bat-sure will-to see just how far they will go. They will also sit in the car and wonder about the quality and service. Probably check to see the service department hours of operation.. Because in the back of their mind, the quality standard must be less since they can drop the price so far and so fast. The point is this, ask yourself before you give price and terms "how much will you discount?" why should you discount at all? What is the true reason your customer is asking for a discount? Maybe they can't afford it? Most likely they can or they would not be bidding on it in the first place. If you feel compelled to give a little, don't give in on price. When they ask for price concession, Look them dead in the eye without hesitation and say "NO"!

I can't do that. Don't ponder the question, don't pause, don't say let me see what I can do. And for goodness sake don't tell them a range of a discount they can expect. 5-10% all they will hear is 10%.

Say "NO" unequivocally and move on. The ball is in their court. "Why not? Your competition gave us a nice price reduction." If they did give a discount and you have a good understanding of their pricing you will know if your customer is up front with you. If the discount seems greater than there standard pricing, odds are good the customer is not comparing apples to apples, investigate further. Explain you are not like the competition and this is why, service, qualify, delivery, warranty, me, etc.

Give alternatives, can we help with terms, warranty, service, training. If you extend terms, make your customer realize how much they saved by extending payment for three or four months longer. And more importantly, let them know how much you just gave them. Will people pay more for the same type product or services? They do it everyday.

If you do not feel strongly about the price of your company's product or services, it will come across. Command a higher price and stick to it. Don't hesitate, pause or make loose comments like "Let me work in to it." Remember, if you are dealing with someone who is very skilled at negotiating-the second you pause to pound a reduction in price-they will sense you have the ability to come off your price. They will walk away from the deal with something. Now it is just a matter how much you are going to give. An inch or a mile. Some people give for the art of negotiating. Be firm, stand firm. You will gain respect from your customers and managers. Even your stock broker will love you because now your bottom line will look better. Remember, the money you save is the money you keep.