Negotiating Buyer Concerns

C H A P T E R 13

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Learning Objectives

• Describe common types of buyer concerns

• Outline general strategies for negotiating buyer concerns

• Discuss specific methods of negotiating buyer concerns

• Describe ways to deal effectively with buyers who are trained in negotiating

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Step Four – Negotiating the Sale

• Anticipate buyer concerns

• Plan negotiating methods

• Initiate win-win negotiations

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Negotiating the Sale

Negotiation is working to reach an agreement that is mutually satisfactory to buyer and seller.

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Planning for Negotiation

• Anticipate buyer concerns

• Review common types of buyer concerns

• Review methods of negotiating buyer concerns

• Prepare a negotiation worksheet

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Typical Buyer Concerns

• No Need

• Product/Service

• Source of Supply

• Price

• Time

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Tactics For Handling “No Need”

• Suggest closeouts of slow moving merchandise

• Trial offers

• Inventory purchase guarantees

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Product/Service Concerns

• Not established

• Skeptical of popularity/future

• Personal distaste or dislike

• Satisfied with existing product/service

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Handling “Source” Related Concerns

• Identify problems your company can solve

• Focus on profit points

• Focus on superior benefits to the buyer

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Handling “Source” Related Concerns (Continued)

• Encourage trial orders

• Emphasize prospect’s obligation to their business

• Be visible

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Common Price Negotiating Tactics

• Budget limitation

• Take-it-or-leave-it

• Split the difference

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Handling Price Concerns

• Illustrate value through a cluster of satisfactions

• Reduce the focus on price

• Do not apologize for your price

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Handling Price Concerns (Continued)

• Point out the Price/Quality relationships

• Explain the difference between price and cost

• Stand your ground

• Do not concede too quickly

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Price – Iceberg Principle

Price

Favourable credit terms Assistance from

salesperson after

the saleExcellent technical assistance

Quick Delivery

Comprehensive

warranty

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Common Buyer Concerns

• “Price too high”

• “Think about it”

• “Talk to boss”

• “Need more quotes”

• “Set with current supplier”

• “Bad history”

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Strategies For Negotiating Buyer Concerns

• Anticipate Buyer Concerns

• Know the Value of what you are offering

• Prepare for negotiations

• Understand the problem

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Strategies For Negotiating Buyer Concerns - Continued

• Create alternative solutions

• Find some point of agreement

• Do not destroy the relationship with anger

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Added-Value Negotiating

This is a negotiating process where both the seller and the customer search for mutual value so they both feel more comfortable after a sale.

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Methods of Negotiating Buyer Concerns

• Direct denial• Indirect denial• Feel-Felt-Found• Questioning• Superior Benefit

• Demonstration• Trial Offer• Third Party

Testimony• Combination

Methods

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Using a Negotiations Worksheet - Examples

Buyer’s concernType of concern

Possible response

“Fifteen cases of olives will take up valuable space in my receiving room. It is already crowded.”

Product

Direct Denial:

“You will not have to face that problem. With the aid of our merchandising plan you can display 10 cases immediately on the sales floor. Only 5 cases will become reserve stock. You should move all 15 cases in about two weeks.”

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Using a Negotiations Worksheet - Examples

Buyer’s concernType of concern

Possible response

“This is a poor time of the year to buy a large order of olives. People are not buying olives at this time.”

Time

Indirect denial:

“I agree that it has been a problem in the past, but consumer attitudes seem to be changing. We have found that olives sell well all year long if displayed properly. More people are using olives in the preparation of omelettes, pizza, and other dishes. Of course, most relish trays feature olives. We will supply you will point-of-purchase material that suggests new ways to use this high-profit item.”

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Using a Negotiations Worksheet - Examples

Buyer’s concernType of concern

Possible response

“I would rather not tie up money in a large order.” Price

Superior benefit:

“As you know, olives represent a high-profit item. The average margin is 26 percent. With the addition of our $1 per case allowance the margin will rise to about 30 percent. This order will give you a good return on your investment.”