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Ethics and Your Reputation

Ethics and Your Reputation

Written by: Colleen Frye

You’ve all had this type of customer before…. They’ll tell you they are unable to afford the recommended services, they’ll tell you that they can get the same service done down the street for less, or they’ll flat out ask you to knock down the price so that they can afford it.

By this time, you’ve already spent plenty of effort getting the customer to the buying phase, so rather than watching the customer walk, you drop the price & that may have ‘saved’ the job, but what’s been lost is the integrity of your pricing.

There are many, many reasons why a customer will ask you for a discount (we’ve been in similar situations too). They could really be in a financial crisis, big or small but what some customers actually are doing is trying to test your pricing integrity. For example, let’s say you hire a roofing company for your house… they quote you such and such amount and then you say ‘is that your best price?’… and within a few minutes they’re telling you they’ll knock $100 off the price. But then you’re thinking to yourself, you would have paid $100 too much if you didn’t ask.

That’s not that good of a feeling…then you may ask yourself ‘would you call the same roofer again?’ I don’t think I would. The integrity of his pricing, would be gone.

So with all this said…rather than playing this game with your customers, consider some of these tips –

  • Embrace the fact that it’s okay to offer legitimate discounts – like military, senior, police/fire, etc.
  • When a customer asks for a discount, rather than giving in, look at it as an opportunity for you to build even more value in your recommended service.
  • (Personal favorite) Rather than offering a reduced price, add value instead. Rather than taking $50 off the service at hand, offer them a voucher of $50 for their next service. This doesn’t challenge your pricing integrity, this is just a smart way to keep them coming back for more.
  • If you must offer a price concession, consider taking something off the table in return for the price reduction… For example, reduce the warranty on the tire, have your techs work on the vehicle when it’s most convenient for them (get some other higher paying work done before you get to them) – if the customer pays less, they should get less.

Do you have a way of dealing with price concessions that you want to share with other dealers? Let us know and we’d be happy to share.

Inspiration from Tire Review

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