Do you constantly wish that you didn't feel so obliged to offer discount to your customers just because they asked, or wonder why the competition can consistently charge more for their goods or services than you do, and yet yours are better value for money?

I hate being ripped off, worst of all I hate ripping myself off!

When I was about eight years old there was a sign in the corner shop window for tennis balls. Suddenly overwhelmed with an urge to buy one, I rushed home and asked my mother if I could have the money. To my surprise she said, "Yes, OK, how much do you need?"

Flushed with a sense of embarrassment which I still can't explain, I knocked the price down by about 30%. I don't know why, maybe I only like delivering good news, maybe I didn't think she'd give me the full amount - either way I got less than I actually needed, making the whole process a little pointless.

When, I got back to the store, the only thing I could afford was a ping pong ball, which I bought (so that the trip hadn't been a complete waste of time!?!) and then hid it from my mother because I felt stupid.

I'm telling you this because it came rushing (embarrassingly) back to me last week when I overheard a negotiation, and the salesman got me thinking - "how many grown-ups are doing something similar with their company's money?"

Price really embarrasses some people. When a sales person has some flexibility with margin to "get the business" sometimes their inner voice just wants to knock a little off, that the amount could possibly be a little on the high side and anyway, the margin flexibility was probably built in for a moment just like this.

Let me tell you another story;
Skip ahead about ten years from the tennis ball debacle and I'm working for a business that imports the most expensive, stylish and technologically cutting edge aquariums around at that time.

If you wanted one of these, you took your home aquarium hobby really seriously - or could afford someone else to look after it for you.
So, one day this guy calls and asks if we have a certain model in stock, I take the call, check the storeroom and call him back.

"Yes we do! It costs £1,000. You want to pick it up this afternoon? OK, see you then."
So the guy turned up, introduced himself and he inspected the aquarium.
He turned to the most senior salesman in the room and asked "How much discount for cash?"
To which Mr. Senior Salesman replies "10%"
So the customer pulled £1,000 in cash out of his wallet, counted £100 from the top and gave us the £900.
Now as a business there was no 10% discount rule, there was flexibility sure, but there was nothing in the induction about cash discounts.

Let's have a look at that again;
The customer had clearly come equipped to buy the aquarium; he had called to check the price, travelled to pick it up himself and brought the full amount in cash.

So why did the salesman feel the need to give him a discount?
Maybe he only liked to deliver 'good' news, maybe he didn't think the customer would give him the full amount - either way he got less than he actually could have got, 10% less - could you imagine increasing your turnover by 10%?

I'll tell you something, it's a lot harder than decreasing your turnover by 10%!
Since then, I have come to learn that the price of a product should always be the amount that it is worth to the customer, so ask yourself this;
Are you ever embarrassed when you tell people how much they will have to pay for your product or service?

Why?

If you are ripping people off, then quite right, feel embarrassed, get out while you can and find a product which you feel proud of.
But if it's worth it, if the price is fair, what's your problem?

Here's another question;
Those shoes you wear to work, were they the cheapest on the high street?
I bet they weren't. Someone out there was selling cheaper shoes than you bought; so why did you buy them?

Was it because you wanted them, liked the colour, liked the style, made you feel good about yourself, because they were a really nice fit, was the sales person pleasant?

Do this now
Write down the price of your service or product next to the price of three competitor prices.

Then, underneath the prices that are less expensive than yours, write three good reasons why your product or service is a better buy.

Similarly, for all those that are more expensive, find three things that both your product and theirs have in common.

Those are the reasons that make what you have to offer special and value for money, they should form a major part of your defence during objections regarding price.

Simply put, these few sentences should enable you to prove why your product or service costs as much as it does.

Do this from now on
If someone is ready to offer you the right amount of money, don't let your own insecurity force you to make do with a ping pong alternative.