The Negotiator Magazine

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When You're Negotiating, Money Isn't As Important as You Think

Roger Dawson

Let me tell you about my pet subject: When you're selling your product or service, money is way down the list of things that are important to the other side.

First, we'll talk about something that you may find hard to believe but it's something of which I've become convinced-that people want to spend more, not less, and that the price concerns salespeople more than the people to whom they sell. Then I'll teach you all the things that are more important to people than money. Finally, I'll teach you some techniques to find out how much they'll pay.

People Want To Pay More, Not Less

After almost two decades of training salespeople, I have become convinced that price concerns salespeople more than it does the people to whom they sell. I'll go even further than that-I think that customers who may be asking you to cut your price are secretly wishing that they could pay more for your product. Hear me out before you dismiss this as being imbecilic.

I was the merchandise manager at the Montgomery Ward store in Bakersfield, California back in 1971. Although Bakersfield was not a large town, the store ranked 13th in volume in a chain of more than 600 stores. Why did it do so well? In my opinion, it was because head office left us alone and allowed us to sell to the needs of the local population.

For example, we did a huge business in home air conditioners because of the outrageously hot summers. In Bakersfield, it's common for it to be 100 degrees at midnight. In those days an average blue-collar home in that city cost around $30,000. The air conditioners that we would install in these homes might cost $10,000 to $12,000. It was very hard for me to get new salespeople started selling in that department because they had a real resistance to selling something that cost more money than they had ever made in a year. They simply didn't believe that anybody would spend $12,000 to put an air conditioner in a $30,000 home. The customers were willing to pay it, as was illustrated by our huge sales volume, but the salespeople weren't willing to support these decisions because they thought it was outrageously expensive.

However, if I could get salespeople started to where they began to make big money and they installed air conditioner in their own homes, suddenly they didn't think it was so outrageous any more, and they would dismiss the price objection as if it didn't exist.

Beginning stockbrokers have the same problem. It's very hard for them to ask a client to invest $100,000 when they don't know where lunch money is coming from. Once they become affluent, their sales snowball.

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November 2004