Everybody Wants A Discount, Right?
- Category: Business
- Published: Tuesday, 13 April 2021 14:58
- Written by Lawrence A Robinson
- Hits: 210
By Lawrence A Robinson
A few days ago, we asked members of Build Black Daily, this question.
What is the hardest part for you when dealing with clients?
In other words, what one thing bugs the hell out of you? And if I had a magic wand and could make it go *poof* --- what would that do for you and the projects you work on?
Over 42% of the members that responded had the same concern. We picked statements from two of those members.
BRITTANY AUSTIN of Queen B's Royal Cleanings, LLC. said: The thing that bugs me the most is that people don't seem to respectand understand the value of another's worth. If i had a magic wand, I would tap it on the head of the consumer and a list of all of the overhead & backend costs that they don'twill appear. This will help show them why people charge as they do for their services & supplies.It will also shed a big light on the things that the consumer doesn't see up front that happens on the back end in order to keep the business up and running smoothly.
Build Black Daily member Clyde L. Lemon, Owner & Photographer of First Klass Memories, said this: The hardest thing for me when dealing with clients is the minimizing of my skill set in order to justify requesting a discount on services.
Both Clyde L. Lemon and Brittany Austin agree customers asking for 'the hook up' is the hardest part dealing with clients, so how should this be handled?
Customers asking for a discount or the 'hook up' is not new, and unfortunately my magic wand can't make it go 'poof'. Seem like everybody asks for a discount even when it is not warranted. I know that I ask for the discount and I usually get it. Hey, even McDonalds gives me the senior discount.
The good news is that when a potential customer asks for a discount, that usually indicates that they have decided to buy. The questionable news is, 'will they buy from you?'
Since you know that people are going to ask for a discount, wouldn't it be smart to structure your fees in such a way that you can give a discount? Create 'lost leaders' or special packages such that if the customer buys two products, then they will get a percentage off the entire deal. There are many ways to structure discounts so that you earn more money per customer and the customer feels like they got a great deal as well. Earning more money per customer increases your Return On Investment (ROI) by decreasing the cost of acquiring new customers.
For instance, my business is a monthly subscription with escalating fees at each new phase of increased value. When a potentially new client asked for a discount, I would offer a large discount off the setup fees for the next growth level. The client is incentivized to work smarter and grow faster to reach the next level. That's a win for my company and a larger win for the client, because he not only grew his company, but he received a big bonus for doing it.
When a potential client asks for a discount, stop selling and start negotiating. The sale has been made now you are negotiating the price and terms. When you have discounted bundles or packages already available and you know your cost and margins, then negotiating a discounted agreement is easier. You should know your numbers.
I hope this discussion helped.
The Build Black Daily collaboration is honored to answer our member's business questions. We will hold semiweekly virtual meetings starting soon. Watch your emails for start times and dates and let us know what you are thinking.