I wrote sometime back about the drill and the hole:  “No one wants to buy a quarter-inch drill.  They want to buy a quarter-inch hole.”  (Read the post here.  It’s all about getting in the hearts and minds of the customer, the language of the customer, understanding the pain and [...]

For clients who sell services, I always strongly recommend fixed-fee pricing wherever possible as long as you can properly scope the work.  In my experience, a fixed-fee pricing model generally results in higher profitability. All the ways I dislike pricing by the hour?  Let me count the ways: Customers readily [...]

One question I am asked a lot at workshops and presentations is:  what about the “mark it up to mark it down” approach?  In other words, what if inflate my initial price so I can discount it when I get customer price pressure?  Then my final price is fair for [...]

Scenario A:  We quote $5,000 to a customer for a list of products or services.  Customer says we need to be at $4,500 to win the business.  We agree to discount the deal by $500. In Scenario A, the customer gave up nothing to get a discount.  We changed the [...]

Many companies are tempted to win new prospects and grow market share through what they consider “strategic discounting.”  There are a lot of rationalizations for this, and it usually involves a belief that we will be able to increase the price over time once we win the business and prove [...]

Recently, a client in a professional services industry told me these words:  "We never discount without changing scope.  If we change price for a customer, we remove something from the project." Call me a skeptic.  It's rare to have that kind of discipline and price integrity.  I asked them about [...]

Everyone loves surprises.  Except when it’s a nasty surprise.  And sales people know this:  customers hate price surprises.  They feel like it’s a bait and switch. I see a clear opportunity for my clients to increase profits AND reduce customer pain and price sensitivity by ensuring expectations are clear up [...]

When sales teams tell me they are limited in pricing power because of competition, they often cite competitive price match requests as a prime example.  Customers offer a version of “Competitor XYZ down the street can give me the same thing for 5% less.  If you’ll match their price, I’ll [...]