A lot of sales professionals will fight hard to get a client by cutting the price of their product or service as the first defense in trying to not lose the sale.
Marketing expert Bob Bly says that's a mistake. Here are his comments from a recent article he did for the Internet newsletter, "Early to Rise":
Discounting stinks as a business strategy, because the more you lower your price, the less money you make. Eventually, you end up working for peanuts - a terrible way to live - for customers that don't value your service, experience, or knowledge.
Also, if low price is your only selling point, what happens when the guy across the street undercuts you in a price war?
Low-priced vendors and their employees resent working for so little, which translates into crappy service for the customer.
Nobody wins.
So instead of being the low-priced bidder, think about how you can add value to your service - and, by doing so, command premium rates. You'll make more money and attract a better class of clientele that will respect you more and be happier with what you're doing for them.
Everyone wins.
My opinion: There is a time and a place for bargaining with a buyer and cutting your price. But Bly is correct in much of what he says...you will be happier (and wealthier) if you charge a premium for your product, and then provide a premium service following the sale.
