Selling the Price Increase

25Negotiating the Price Increase: D.E.A.L. Framework

In most situations, price increase negotiation is straightforward, simple and fast. However, it is important to understand the difference between questions, objections, and negotiation before you negotiate:

• Questions are simply the pursuit of clarification, understanding, and certainty and are a natural path to acceptance.
• Objections are disagreements and nonacceptance. They are roadblocks to price increase acceptance.
• Negotiation begins when your customer accepts the inevitability of the price increase but not your terms and conditions.

The biggest mistake sellers make when negotiating price increases is negotiating before they have acceptance. When you negotiate prematurely, before your customer accepts the price increase, you'll give away your price increase percentage points when you don't need to do so. For example:

• Customer objects: “I don't think this is fair. If you do this I'm going to start buying from your competitor.”
• Seller negotiates prematurely: “Well, I can lower the increase from 10 percent to 3 percent; how about that?”

In this scenario, the seller negotiated before any attempt to clarify and handle the customer's objection. This is why it is essential to answer questions and handle objections BEFORE you begin negotiating.

Should your customer respond with, “You are out of your mind, I'm not paying that!” you are dealing with an objection and you should not begin offering concessions. Instead, use one ...