Read time: 4 minutes
Negotiating with corporates can often be an uncomfortable task, especially for purpose entrepreneurs.
Many struggle with leading negotiations and effectively communicating the value of their product, often resulting in closing deals with reduced fees or offering “free” trials.
It’s a trap that no one tells you about, and failing to close on your true value can severely impact revenues.
But what about when you’re not a big enterprise? What if you’re a small team between 1-20 people?
Before you know it, you’re anxious before a big meeting.
It doesn’t have to be that way
It shouldn’t be that way.
Today, I want to shift that perspective and make closing deals with corporates feel more natural and, perhaps, even fun.
Let’s dive in
1. Develop internal salespeople
How can you develop internal salespeople within your client’s organization without being physically present?
If your product is primarily used by a specific department and not directly by the CEO, start by introducing your product to that department.
Allow them to become advocates for your product.
Provide them with a concise one-page value sheet that clearly depicts the unique value your product delivers.
By doing so, when these advocates enter the CEO’s room, the focus of the discussion will shift from price to the value your product brings.
Over-communicate the value and forget about price at this stage.
The idea is that by emphasizing the value, the pricing discussion becomes secondary, and it becomes evident that your specific solution is exactly what they need.
2. Negotiate without price
When in a room with a decision maker, skillful navigation of the discussion is crucial.
Conversations about your business may veer off in different directions, but they often circle back to the topic of price, which can be a stumbling block for many purpose entrepreneurs.
Decision makers have a habit to shift responsibility by mentioning budget constraints from the CFO or other financial considerations.
This can indicate two possibilities:
- You haven’t effectively communicated the value of your product, or
- they genuinely face budget limitations but are still interested in trying your product.
If the conversation takes a negative turn, it’s important to take proactive steps.
One effective approach is to bring up the end-users within the organization and involve them in the discussion.
This may require arranging another meeting where they can participate or stepping out of the room to allow their input.
By including the people who will use your product/service, you bring a fresh perspective and demonstrate the value of their input.
This not only shows your commitment to their needs but also allows decision makers to directly hear how your offering can benefit their organization.
If the conversation becomes challenging, don’t rush their decision. Take the time to involve relevant stakeholders and foster thoughtful consideration.
3. Raise a nominal invoice
Facing with a scenario where a trial or reduced fee is being discussed?
It can be tempting to simply agree and offer your product at a lower cost.
However, it’s important to commit to the deal while also maintaining the perception of your true value.
Here’s how you can do it:
- Commit to the deal and offer your product for a select period of time at the reduced fee or as a trial.
- At the end of the agreed period, raise a nominal invoice that reflects the actual true value of your product, but provide a discount on the full fee.
Why is this tactic necessary?
By invoicing the true value, even with a full discount, you ensure that the client is aware of the actual cost of your product.
This way, you avoid undervaluing your own offering by accepting a reduced amount.
You want to leave the impression that your product is worth its true value, lets say “state your $”.
(If &)When the client comes back for another round of your product or service, provided it is necessary for their organization’s improved performance, they will be more likely to agree to the full amount that you initially invoiced.
It’s crucial to know that most corporates will agree to your price if you have effectively over-communicated the value of your product.
However, if value hasn’t been adequately conveyed, it can be easy to fall into the trap of accepting a lower price because you’re eager for the sale.
Even when you’re experiencing a lack of leads, conversations, and the phone isn’t ringing, sticking to your true value is vital for the long-term success of your business.
- Develop an internal team: Empower the department using your product to become advocates for it, so they can discuss its value with decision-makers.
- Negotiate without price: Over-communicate the value of your product/service to shift the focus from price to the benefits it provides.
- Raise a nominal invoice: Invoice the true value of your product/service, even if offered at a reduced fee or as a trial, to reinforce its worth and avoid undervaluing it.
→ Action Step: Create a concise one-page (A4) value sheet that effectively showcases the unique benefits of your product/service. Find the right internal team to advocate your product/service.