Negotiation Tips: Getting the Best Price

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How to negotiate with food When negotiating there are two ways to name a price.

You either publish one in advance, and lose all chances of negotiating a better deal, or you can negotiate one, where you hold the best cards.

If you publish a price on your website, or in your brochure, it becomes binding in many ways.  Psychologically the customer will see this as your maximum price and will try to get a reduction on this.  If you’ve tried to be clever, and have inflated the published price, then it might drive away many prospective customers that are initially making a search based on price.

The reality is that price is rarely the only factor buyers take into account.  So you can negotiate.

But to be able to negotiate you need to determine what the buyer needs and wants.  It isn’t enough to know they want, say, a food hygiene course.  Food hygiene courses are a commodity and your competitors are also likely to sell them at a similar price.  If so, then price is likely to dictate the outcome of your negotiation unless you can take the decision away from the price.

Your price, and that of your competitor, is likely to be based on set criteria such as delivery starting at 9am at a given location etc.  

So if you start by asking for more information about who the course is for, where they are based, their shift patterns etc it might be you can come up with a proposal that is based on convenience and, or, value to the customer rather than price.    

 

An example of adding value to a basic commodity 

For example, a few years ago I negotiated a food hygiene course for a hotel chain.  In discussion  I discovered that most of the attendees were managers that weren’t involved in food prep but needed a better awareness of hygiene, and that they all had problems getting repeat business in their hotels and restaurants.   The buyer was also interested in increasing “team cohesion” and might buy a team building course in the future.

So we offered to package the food hygiene course with a “free” short course on getting customers to make repeat bookings and an intro to team building.  The “free” bit was split between a 30 minute session at the beginning of the day and a 30 minute session at the end of the day.  We also provided the food hygiene course handouts and repeat bookings session notes as a branded e-book that we delivered to their inboxes during the sessions.

Because the attendees worked in a world where good food should have been the norm, but they weren’t personally involved in food prep, we also added a twist to the lunchtime catering.  This was the intro to team building. We got some of them to don whites and try their hand at some rapid recipes they could cook in front of their colleagues (whilst applying what they had learnt of course).

The price of course was now higher than a standard food hygiene course but now the buyer couldn’t now make comparisons with our competitors.  In addition we made sure he understood the “value” of what we offered.

The free parts cost little to deliver and simply covered some basics that they should have known but weren’t delivering.  It was delivered in a friendly interactive way where I carried out some role play with the CEO who had initiated the original purchase.

We were later told that seeing the CEO role playing and being human, plus the the cooking,  did more for team cohesion than anything they’d done before .. and we were booked to provide additional courses without having to pitch against a competitor.

The “free” repeat business sessions also lead to more work and so were a very cost effective way to pitch for more work without appearing to pitch.  There is nothing like a demo to prove value.

 

Negotiation Lessons

When asked to quote for a course it isn’t always possible to deliver “extras” but you do need to ask the right questions to discover need.

Interestingly I know our main competitor could have offered the same type of package.  But they didn’t because they didn’t ask the right questions.

 

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