Selling the Price Increase

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Suppose your customer says, “Alright, I get it. Your costs are going up and you need to pass on some of it. I'm willing to pay a little more, but you are asking for too much.” What next? At this moment of truth, as the negotiation is initiated, there are four possible paths you may take: capitulate, counter, confront, clarify.

Capitulate

Some sellers, out of insecurity, quickly capitulate to avoid conflict, make their customer happy, win approval, or just get it over with. They go all the way to the bottom limit of their negotiation authority and give away the maximum price increase concession with no attempt whatsoever to negotiate, leaving price increase points, profits, commissions, and bonuses on the table.

Counter

Other salespeople jump right into negotiation with a quick reactive counteroffer before truly understanding the customer's position. They react without thinking. This can cause them to move too fast, negotiate the wrong thing, or give away unnecessary early concessions.

Confront

Then there are the sellers whose reflex response is to argue back and defend their position without even listening to their customer. They treat their customer as an adversary and attempt to prevail in an argument. In this state, negotiation becomes a competition rather than a collaboration.

Out of frustration, they may tell their customer to go pound sand. Or respond with something like, “That's fine. If you don't want to pay the increase, there are a dozen other people ...