If you are a salesperson you must have been asked this question on a number of occasions. Someone just pops in at your work place, looks at your products then the drops the question, “how much does it cost?”
Some people can also send you emails or make a phone call to enquire about your prices.
But why is this question difficult to answer? If you don’t have a fixed price for your products or services or if you don’t have a formula to determine the prices then the price you quote may be higher or lower than the customer’s expectation.
If it is higher, you may end up losing the customer and if the price you quote is low you shall have lost some cash if the customer eventually purchases your product or service.
Most sales people quote prices based on how they rate the client. If the client looks moneyed, they will quote higher prices while for an unkempt client, they will quote low prices.
This technique works only if you can observe the customer. But what about a case where the price is asked through an email or a phone call? It will require you to play your cards very well otherwise you may end up losing the client.
There are certain types of businesses in which this question does not arise, especially if you have fixed-price items with price tags. But if your business involves some bargaining or if you are running a service-type business with the prices depending on the project specifics, the answer may not be simple.
For these service-type businesses, the price you charge may depend on your current workload and what the client desires. Some customers may want custom made solutions that are built from the scratch, while others may require some modifications on the already existing solutions. All these will go for different prices.
When you have so much pending work, you will tend to charge highly for your services, the converse is true if you don’t have much work.
The most common problem with the prospective clients is that they always believe that the price you quote is high. This is more so if they have no knowledge, understanding or belief in the value of your product or service. Almost 95 percent of the people asking the price will fall in this category.
The question is; do you sacrifice high quality for an approach that allows for a defined but a low end fee structure or you stick to clients who value high quality and can afford it?
If you choose the later, it may not matter much how you answer the cost question. This is the group that believes that the price you quote is always high. So instead of wasting your time trying to convince them that your product is worth the price, you would rather focus on getting more qualified prospects to know, understand and believe in the value of your product or service.
The best process through which people can get to know your prices is though referrals. Those who have bought your products or services can refer their friends to you. So, what you need to do is to maintain the high quality of your products or services so as to reduce the frequency of the “How much does it cost” question.