14 Top Tips On How to Get a Price Increase

14 Top Tips On How to Get a Price Increase

11 Aug 2020


14 Top Tips On How to Get a Price Increase.
by Kieran Perry

 

Explain, But Don't Apologize
When discussing the price increase in a business-to-business environment, it is important to remember that your customers have probably had to have the same discussion within their own business and to their own customers.

A company exists only as long as it earns a profit and it can only do that if it delivers a quality product or service at the right price. This means that the key to any conversation about raising the price is to emphasize that such an increase will ensure product quality and service.

Do not apologize for the need to take a price increase. Apologizing may appear to be courteous, but this is business, and if you apologize, you will come across as if you do not believe in the price increase.

Be Bold but kind

You may be tempted not to mention it at all, and to hope people won’t notice, but for most businesses where they have a lot of regular, repeat customers, most of them will notice, sooner or later.

It’s important to lay down the reasons honestly but be wary of saying too much – to avoid over justifying and being unclear.

Talk About your Value
While some customers are very price-sensitive, most people don’t buy only on price. Many will stay with you if they value your product or service enough. So take the opportunity to remind people what they're getting.

Best Quality products, Our Warranty, Our Stock Holding, Our Quality, Our Back Up, Our New products, etc to suit your sector and business model.

Always tell customers what your  "USPs" are again. 

Take some time to work out your Unique Selling Points.

“Communicate the core value proposition of your company, state some of the key benefits you’ve delivered through the years (be specific), and explain how the cost increase will support the company’s clear goal of solving even more customer problems in the years to come.”


Customers Need To Know
Explain - The price increase is the same for all your customers. (only if that is correct)

Emphasize it is only being taken to ensure continued quality and service and improve the overall quality and service..


Communicate Clearly
When the new price list has gone out, be prepared to answer a lot of questions, both by email/phone.

Communicating with people clearly and promptly may not succeed in making everyone accept the new prices, but it will at least make them feel as if they’ve been treated fairly.


What Other Options Can you Offer and Sell
The best way to make a price increase go down well is to offer your customers options. 

Remind your customers the value they get from your products and service.

 

Customers Loyalty - Is the Key
For this one, subtlety is key.

It’s true – your customers are most likely to have been in the same position as your company is now and possibly had to introduce their own price increase recently - it made business sense for them–and they had to communicate it to their clients just the same way.

Get on your customers empathetic side by continuously referencing their role as a business leader and not only as your customer.

You can talk to them about helping them put together a plan to communicate the price increase to their customers, if needed.


Know how much your customers rely on our products to run their business.
As a major supplier, get them to think long-term by saying that the price increase is necessary to maintain the level of quality and performance they deliver to their customers.


Key Reminders

1. Don't be overly apologetic, when discussing the price increase be sure to show empathy for the customer, but remain firm in what you're saying.

2. Expalin you maybe giving them a clear notice period to prepare them for the price increase to come.

3. If the customer senses any hesitation on your part, they will likely try to exploit it in the form of a price concession from you.

4. Do it in a meeting. Discuss the price increase and give reasoning on every sales call. Don’t let it come to the point where customers find out about the price increase on an invoice.

5. Study the price increase. Believe it. You need to understand how your price increases work -because customers will want you to expalin it.

6. Make sure the price message is consistent for all customers. Consistency and accuracy must be maintained.

7. Don’t hesitate to escalate. Ensure in your next appointment with your customers you set up meetings with higher key management so they can ask pricing questions if needed.

8. It’s all business. Trust your company’s decision and take conscious steps to deepen your understanding of your pricing and products usp's.

9. Do not attempt to sell the price increase solely based on how your competitors or other suppliers are also going to put the price up. This makes you look weak and makes it appear your price increase is based solely on the reason you think you can get away with it in the current market.

10. Do not immediately join in with your other sales collegues complaining about how difficult it’s going to be trying to get the price increase through. A very high number of price increases fail to stick based solely on the fact the sales force refused to believe and support the price increase. Investing in sales training and motivation to get your sales team on the right track.

11. Do not discuss the price increase at the very end of your sales call and try to control your body language as it may appear nervous and your speech a little less confident than normal. Customers will see through that, and professional buyers in particular will pick up on the signs of weakness and attempt to leverage it for an exception.

12. Know your Competitors service, quality and pricing.

13. Do not go into your customer thinking about how you will try to negotiate a smaller increase. (consider what else your company could offer to help support the customer - something of low cost to you but high value to the customer - ie more regular deliveries, paperwork emailed, more visits, retail merchandising etc) If you go in expecting less, you will walk out with less.

14. In order to be paid what you are worth, you must charge what you are worth. Although this is not something that can be explicitly communicated to the customer, this general sense is what sets apart the best practice companies and high-performing sales professionals.

 

Click on my main website to see my full details - www.kieranperry.com