How to talk about pricing is a key subject when winning new clients.
Knowing how to tackle the pricing issue is a micro-science in its own right. This article will highlight some of the key points for you to consider when talking about pricing in your prospective client conversations.
Introducing Price at the Right Time
When we introduce price, bear in mind that at first, it would be the only thing that the prospect is trying to find out from you because at that point there is no relationship, no rapport, no empathy and no connection.
From the prospect’s point of view, they are thinking about the fact that they already have an accountant. You are another accountant and they cannot differentiate between the two. So the only way they can immediately make some kind of differentiation is in terms of price.
Since that's the way they are thinking, they will be pushing you for a price. Please do not give in to that pressure. There are ways and means to get around this and handle the situation. Most important is the need to employ the effective use of language, including the psychology involved in that.
There are two approaches you can use effectively to answer the question of pricing early in the conversation.
This approach will help you to move around the issue of price at the early stage with a prospective new client:
The client asks, “Well, how much is it?”, “How much will it cost?”
In this situation, they are not allowing you to build a relationship or a rapport with them. The prospect is not even looking to find out what the solution might be to gauge what the price might be.
Your reply could be to quote a high figure. So you might say….“Oh somewhere between x price and x price”
The prospective client's reaction will likely be one of surprise, “What?!”
Your retort is, “So now you can see that because I haven’t had the opportunity to find out what exactly is going on in your business and what exactly you need, how inaccurate that pricing is.”
You continue to explain that you won't quote a price right now. At this point the prospective client is in a position to educate you about their business. You can continue, “I can get to the point in the meeting where I can include a full costing in a proposal document. Would that be okay?”
“Good, let’s continue.”
It may seemingly be a flippant way of conducting a meeting, but over the years I've been able to project this in an unoffensive manner which is not off-putting to the potential buyer.
The prospect must understand the benefits of what we can deliver for them and make them understand why they need to make the investment.
There are other ways and means around the pricing question. A conversation might go this way…
You say, “I don’t know how much it will cost”
They reply, “Well you must know. You have done these jobs before, so they are all the same!”
You reply, “Well with all due respect, Mr. and Mrs. Prospect, they are not the same. No two clients are the same and whilst I can give you a ballpark figure here and now, this may or may not be an accurate figure. So, if you will forgive me, I am going to pass on the question of price with the proviso and promise that I am coming back to you on this as soon as I actually know what the correct solution and fit is for your business.”
That is an example of how you can delay the introduction of price into the conversation until they have allowed the opportunity to find out more about them so you can prepare proposal documents.
How to Frame your Pricing
One of the most important things to remember is to minimise the pricing. Minimise the price by presenting it in terms of a monthly amount.
Alternatively, present it in terms of the amount of the monthly increase it would be to what they are now paying.
Any talk of price should be discussed in terms of the ‘investment’ they are going to make and what the client will receive in return. Please do note the use of the word ‘investment’ rather than fee, cost or price.
Investment over Price
It is important to build their proposal up into being an investment. The thought of an investment, in the prospective client's mind, is a much bigger number than it might actually be.
We must maximise what we are going to do for them rather than listing the services we provide. Ensure you keep in mind the outcomes that you are going to create for the prospect and what those services create or enable the prospect to do with their business.
Making Pricing an Effective Conversation
Price becomes a much more effective tool when we conduct the conversation in this way. We can thus diminish and minimise what it is going to take to win the client. Remember, at the starting point, you are no different to any other accountant in terms of how much you cost in the prospect's mind. This changes that.
We need to become skilled in moving the conversation to the point where the prospect says that they understand. The prospect will understand what we can deliver for them and how it will benefit them by going through the hassle of changing accountants. This, in turn, makes them understand why they need to make the investment.
So we not only have a commercial argument to win, but a logical and an emotional one as well. The price is brought in at a later stage in the conversation. That is, when we have the conceptual agreement on what should be the best solution for the business.
Once we have an agreement from the prospect, we can really fill out the details of why it is the right solution and expand on the benefits to them and their business. The prospect then will clearly see how working with us, the price of which is a perceptively small amount in comparison to what they are about to receive.
This is a broad overview of how to introduce price in a nutshell. To be most effective, these practices are to be rehearsed, trained and honed over time.
For more guidance on how you can manage prospective client conversations effectively, consider Episode 31 in the New Clients Now video series. You'll learn how to focus the prospect on what you can offer so that they will not be judging you on pricing, but will be more eager to engage your services based on value.