Look, it can be nerve-racking when a buyer cuts to the chase and asks for the price of your physical product. You usually need more information in order to give them an accurate quote - if you provide pricing that is too low you lose money; too high and you could lose potential business. What is the best way to navigate the "how much does it cost" quagmire?
Here are 3 things to consider when replying in order to secure that sale:
1) TAKE IT AS A COMPLIMENT AND A BUYING SIGNAL!
If they ask the question it’s a good thing - your product has their attention! Now it’s your job to use this question to drive the sale forward and solicit more information so you can give them a quote and close the deal.
Buyers asking for pricing are interested in placing orders and they are trying to figure out if your product will work for them before wasting any time. However, they may not be educated enough on the variations of your product OR the variables of their needs that could affect the price they would have to pay.
DON’T DO THIS: “ If a buyer asks for your price early in the conversation DON'T act offended and DON'T tell them 'No' or 'I can’t quote - there are too many variables'.”
2) PLAN AN ALTERNATIVE ANSWER THAT BUILDS THEIR BUYING CONFIDENCE
Expect this question and think through a convincing answer that will reassure the buyer your product will work for their budget and their clientele. DON'T feel pressured to provide an exact number, but DO consider giving them a range and explaining what variables can affect the cost.
One great answer is to tell them the product's MSRP, and the price it is currently selling at on Amazon.com or your website. This provides insight into whether or not your product is a successful match for their existing consumers (this is important – imagine the budget of shoppers in Dollar General vs. Nordstrom). Retail costs also allow buyers to compare pricing with their competitors. If their competitors are successfully pricing similar products then your buyer can better determine if your product will work for their budget.
Consider the possibility that your product might be more expensive at retail. If this is the case also be prepared to explain 1-3 points of difference that justify this higher cost, and why consumers will still buy at this price. Examples are:
Increased brand perception in the market
A superior/unique natural ingredient call-out
Past sales accolades such as your product is the #1 seller on Amazon in this category
FOR EXAMPLE: Here’s a great YES reply – “This product’s MSRP is $12.99, which is what you’ll see in most retail chains and on our website. We’re trending #1 in Kroger this month. We can send you custom costing in a few days after this meeting. What are the best sellers in your category retailing at? What margins do you need to have for things to work in your store?”
3) ASK THE RIGHT QUESTIONS TO SEND A PROPER QUOTE
After you have educated your buyer on why your product is exceptional, it's time to educate yourself on the costs you will incur delivering the product for them.
Here are the immediate questions to ask:
What types of margins do you need to carry in your store?
What quantities do you typically move through in a month on similar products?
What is the quantity of your first order, and the quantity of the order annually?
Do you have any shelf or slotting fees we should consider?
What percentage should we allocate for billbacks that you typically see in your store?
Who pays for packaging artwork and what are the typical rates (if it’s private label)?
Do you prefer to have pick up and/or delivery pricing?
Are there any other unique elements of working with you that might affect our costs in getting your product?
BEST PRACTICES: Turn the question “HOW MUCH?” into an opportunity to keep the conversation going by saying "YES I’ll TELL YOU LATER!" and asking questions so you can figure out what cost to give.
Being confronted by the cost question early is a positive sign that the retail buyer is interested. Treat this as a moment of victory and turn their doubt into the conviction that they should move forward and entrust you with their business. Do this successfully by offering a YES type answer, providing data that assures buyers your product will work for them and asking questions so you can quote accurately in your follow-up. The outcome will lead to better conversations with buyers, more lucrative sales and increased data and confidence for your team when building pricing structures.
YOUR NEXT STEPS:
Write out a quick template answer to these questions that make sense for your product:
Where we’re succeeding/Why this price makes sense
Questions so you can follow-up with a cost
If you want to be a student of sales here is more information.
This principle is called YES AND MAKE-IT-YOUR-OWN and I’ve taken it from the art of IMPROV COMEDY! Imagine the performance stage is just like life. If anyone brings you a problem, question or action never reply “no!” because the scene and momentum stops! The actor or, in our case, the retail buyer will not know where to go next. You will lose comedy if you’re in a performance AND you will lose a sale in a buyer meeting.
Always say “YES!” and then respond and play off of what they said, adding new information to the scene to keep it moving. Questions that naturally follow what the buyer just said is the best way to keep the conversation moving in the positive, interesting and life changing direction towards a purchase order.
The next time a retail buyer says anything off-putting, don’t stop in your tracks. Instead say YES and then MAKE IT YOUR OWN by asking them questions to better understand where they are coming from. The outcome will be better sales meetings and better rapport with your buyer.
Want more information on acing your next retail buyer meeting? This point is one of 5 that we will teach in our UPCOMING LIVE WEBINAR: 5 Steps To Acing Your Next Retail Buyer Meeting. Click here to RSVP and attend: https://www.bigmarker.com/pearl-resourcing1/5-Steps-To-Acing-Your-Next-Retail-Buyer-Meeting
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