Even before I started to work in the corporate world, any negotiation, whether inside or outside our house, whether with a friend or with a stranger, such task has always been a challenging one. And now, being an accountant and a consultant, negotiating the price with my clients is even more complicated.
So many considerations are needed to be taken in order to have good results from a negotiation with your client because as vendors, we always will want to get the good price that is close to our asking price with a few hassles and problems as much as possible. On the other hand, as a customer, we do want a good price with terms that the vendor will have to organize and do the necessary procedures for the rest of the deal.
While the terms and conditions in a deal, including warranties and liabilities, are all part of the negotiation process, the fee or price is always the main consideration.
The following are my important tips on how to negotiate your price with your client:
Be not the first to mention the price
A common practice in price negotiation is to let the other person declare the price first because this will establish how high or how low the price can be negotiated. It will also inform you whether or not you are in the right price range. However, if you will be required to name your price, set your price at reasonable maximum price in which you will be paid and you can start to negotiate down from there.
Your price is an investment not an expense
Emphasize with your client that what are you offering is not an expense or a cost but rather an investment to them. Remember that your clients are as much interested in what you can offer as to what price you will charge them. Highlight the value of your service by pointing out your expertise on the subject matter, the quality of service you will deliver, and how your work can add value to them. Your clients will most likely choose the one whom they can trust to execute the needed work.
Allow discounts but set a limit
Sometimes there are clients that always ask for discounts for many reasons. I believe that offering a discount in your price will usually put you in a favorable side of the negotiation, but doing so must be limited. You can adjust the terms and conditions of the deal to be provided in order to meet your discounted price or you can also offer them a lower price of the deal for a limited period and will renegotiate when the deal expires. However, please be reminded not to negotiate and establish a reduced rate of your price until you are ready to accept it.
Don’t be afraid to say no
A normal pitfall in a negotiation is reducing the price until the client accepts but such action will never lead you any further. Please remember not to quickly concede to a client’s requests because such act will signal them that you are not an equal partner in the relationship. Don’t be afraid to say no to requests if the issues, terms, and conditions are very critical for you. Both you and your client are businesspeople and you deserve the opportunity to have a profitable relationship with them.
Before you start any of your negotiation, know what your client requires from you as well as what you want from them. Take time to understand why the client is purchasing your services or product. Finally, know how much is the minimum price you’re going to accept and be ready to walk away if you need to.