It is interesting how sometimes sales people are their own worst enemy. Pricing is a classic example of this. Most sales people dont know how to structure a proposal in such a way that all the preliminary work done by the sales person is reflected within it.  Pricing should never be given before you have seperated the prospects from the suspects. I have covered previously how sales people hear different things from the same conversation. It is critically important that you only provide pricing to those people ready to purchase. So having completed your sales process you are at the point where you need to provide the customer pricing for the solution that will solve their problems and at the same time is competitive with the marketplace and their budget.

There is no hard and fast way to do this, but there are a few landmines you should avoid at all costs:

1. Avoid ranges. Customers will only hear the bottom figure.

2. Make sure its reasonable, logical, and defendable. If you cant in good conscience defend the pricing you are providing, through level of effort, market conditions, complexity of solution, etc. Dont price it. Anyone who is following this blog knows that karma has an impact. If you want to build repeat customers, referrals, and ultimately consistent quota achievement. Dont fleece your customers, be fair and reasonable and you will win them for life.

3. Avoid itemization. Itemization of all the things you are doing often sparks more questions than answers. It also give the customer an opportunity to cut out things that they dont feel are critical (ie. you havent done as great a job of presenting the value).

4.  Pricing without understanding budget. The last thing you want to do is either price too low or too high. If you dont understand the budget of the project there is no way you are going to be able to fairly structure or price the engagement. If the scope is too great for the budget, break up the project into multiple milestones. Get the customer on board, build confidence, and then the ongoing relationship will result in follow on business.

5. Presenting pricing to someone who cant sign the check. If the person you are talking to cant sign the check, dont discuss pricing wiith them. Absolutely discuss budget and scope, but never negotiate. If you dont you will get forced to negotiate serially, which will mean that you will accept deals that arent necessarily good for you or the customer.

Pricing like many elements of the sales profession is more art than science. After working so hard to get the customer to the table make sure you share the meal and no one leaves unhappy.

Moment of Zen
"If one has faith one has everything"- Swami Ramakrishna Paramahamsa

P.S. If you are interested in leveraging the karmic philosophy to accelerate your career or business please check out my website http://www.karmiccoach.com , and get Karma working for you!