As a small business owner in B-to-B you may find yourself struggling during price negotiations. I know: It’s sometimes not easy to cope especially with the purchasing managers of large corporations.
But watch out: Don’t believe the 3 myths for price negotiations with purchasing managers. I busted them in my latest video and blog post: Purchasing Manager Myths – Busted!
I want you to successfully sell your products and services into B-to-B corporations. So, here are 5 useful tips for dealing with the procurement department in these companies:
1. Don’t lower the price without getting something in return
Only make price concession if you can get a comparable value in return. Example: You are prepared to reduce your price by 2%. Then you should not deliver the product, but the customer should pick it up instead.
Never, ever lower the price without getting something in return, only to get the order! And I mean never!!! If you do this once, you are finished. During future negotiations, the buyer will continue to press you for price reductions.
2. Avoid negotiating under pressure
By all means: Avoid negotiating when pressed for time, or if you are under pressure to succeed. Most people – including myself – are poor negotiators when they have their backs against the wall.
3. Prepare thoroughly for the price negotiation!
Figure out what is truly important to the customer, what his needs are, and how you can meet these. What value do you provide for the customer? Articulate your value propositions before the negotiation. Write them down. This will force you to focus your thought process.
4. Don’t let the buyer nickel and dime you!
Some buyers attempt to negotiate every detail to reduce the price each time. Instead, note the buyer’s needs without making concessions, and then negotiate the package as a whole.
5. Don’t lose your cool
Don’t take the procurement manager statements personally. It’s just about business!
The ultimate additional tip!
Do you still have a queasy feeling when you think about the next negotiation with a procurement manager? Then I have the ultimate tip about how to confidently get your arms around any negotiating situation with a buyer:
- Attend a procurement seminar!
Attend a one day procurement seminar focused on your industry! You will learn a lot about the tricks, the needs and the problems of procurement people in your industry. This is a great way to learn what makes buyers tick!
What tips do you have for price negotiations in B2B ?
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