In the current climate it’s not unusual to be asked for a discount. Companies are trying to make savings wherever possible and there will always be a competitor that can offer the same service at a discounted rate. But hold on a minute, can they really offer the SAME service?
It is easy to get side-tracked by prices but what we really need to focus on is the point of difference. There will no doubt be a standard fee in your industry for the service you offer but the way in which you provide the service can be entirely different. Our job is to highlight the value we bring and all those added extras that probably won’t be included in that service they can get elsewhere at rock bottom price. It is up to you to make sure your clients see the value you bring them and make them feel that they would be mad to leave you.
Giving a discount can also be the beginning of a vicious cycle. If you gave a discount last time, then you will be expected to do so again. Also by dropping the price, it raises the question for the customer “why was I paying so much in the first place?”. It reminds me of my breakdown cover. Each year the renewal arrives, the cost is massively increased from the year before. Each year I query this and immediately get offered a discount. A substantial discount too. I now know that I can’t trust them to give me a decent price in the first instance. It’s not a great relationship to have; I don’t feel any allegiance to that organisation whatsoever.
If you are a small company building business on trust and good relations, the act of discount giving can be a dangerous one; it can attract customers that don’t appreciate your expertise as well as damage your credibility and in turn your bank balance.
We would be interested to hear your views.