Handle Price Objections Effectively and Maintain Profits
By: Dave Clossey / T.J. Tedesco
For: High Volume Printing
Published: August, 2002

See if this sounds familiar: One of your key prospects finally lets you in the door to bid on a major job. You’ve asked them to submit bid requests for months, and finally get a big one. Your estimating department works hard to make sure they have all the little details of the job down pat. You submit your quote, including some additional production suggestions that may save the customer a few extra dollars.

Then you get this call: “We really want to work with you, but your number is just too high.” This frustrating scenario is all too common in our industry. The prospect likes your company; they like the effort you put forth to earn their business; they like your innovation and willingness to dig below the surface to find a better solution. Apparently, the only thing they don’t like is the price.

With a sluggish economy, a larger percentage of printing is being bought and sold strictly on price. It can be daunting to hear time and again that everything you’re doing is fine, but you’re just too expensive. However, the last thing you should do is simply slash your prices to keep your machines running. The price you quote on every bid is carefully constructed by taking several factors into account; cutting prices only presents the notion that they’re artificially inflated to begin with.

When pricing pressure is at its strongest, the ability to effectively handle price objections will help you win more business and maintain profits. The best way to handle price objections is to take the focus away from price, and place it on the things you do well that don’t have anything to do with the price on the bid. Here are a few tips that will help you do that:

Provide a better solution – On any given day, a quote request will roll through your plant for a job you simply won’t be competitive on. Many times, printers will simply shrug their shoulders and concentrate on the next one. However, a little brainpower can often lead to a win-win solution that’s a pleasant surprise for the customer and a great job running through your plant.

Call the customer and get every detail possible about the job. If you have a favorite binding and finishing supplier, involve them early in the process as well. Very often, they can provide alternate solutions that will wow your customer and land you the job.

Obviously, it’s almost impossible to expend this much energy on every quote opportunity. But if you think you can provide an alternative solution for a particular job, the effort alone will not be forgotten. And the next time that customer has a difficult one, hopefully they’ll reach for the phone and dial your number. Congratulations! You’ve won top-of-mind positioning.

Flaunt your strengths – Though it may seem to be the case, customers don’t buy from a particular vendor over and over again because that vendor is the cheapest. They buy from reliable companies that remove fear from the buying equation. Think of the reasons why your best customers continue to do business with you. “Lowest prices” should never be one. When you make customers feel completely comfortable with the way you handle their work, you don’t need to have the lowest prices.

One bindery my company knows well is particularly good at listening to customer needs. From their president all the way down to the shipping and receiving department, everyone in this well-run company carries the attitude that they are all one big customer service team. What’s more, every communication they send to prospects and customers drives that point home. Remind your customers as often as possible exactly what your unique selling proposition is and how you make them comfortable throughout the outsourcing process. There are plenty of services and products that your company does well that are truly valuable to many customers in indispensable to some.

Integrity is everything – Be up-front about problems both before and after they occur. Impeccable integrity goes a long way toward helping tame future pricing objections. Customers remember straight shooters that solve problems rather than hide. Favorable customer experiences significantly help remove your products and services from dreaded commodity status. Seasoned print buyers know that things go wrong in today’s imperfect business world. How problems are resolved is what differentiates companies, drives loyalty and contributes to a sustainable profitable pricing structure.

Contact your customers as soon as problems arise. Don’t dominate the call by saying, “We won’t be able to meet your delivery date because our lead operator is out,” or “our truck has a flat tire.” Instead, provide a real solution that will leave your customer with a positive feeling. Offering a discount is rarely that “real” solution; it only placates the customer. It doesn’t solve an actual problem. It may take a little digging to find a solution that your customer will truly appreciate, but it will be well worth the effort when they don’t think twice about sending you their next job.

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Handling price objections is difficult only if you don’t project confidence in your company’s strengths. Nobody wants to be known as the “low-cost leader” in the printing industry. Therefore, why act like one? Give your customers good reasons to continue doing business with you, and let potential customers know how worry-free you’ll make their lives when they send their work to you.

T.J. Tedesco is a “hands-on” marketing, sales, coaching and training consultant to the post press industry. He is the author of Binding, Finishing & Mailing: The Final Word, and Win Top-of-Mind Positioning, both published by GATFPress and available at Amazon.com. T.J. can be reached at (301) 294-9900 or tj@growsales.com.