Why you should ask for a price increase now

Why you should ask for a price increase now

Transcript

We have all seen the news; inflations of 5% or more are not uncommon these days. Raw materials, energy, labour. Just to name a few that cause this surge in inflation around the world.

That opens a big question for the entire sales community. What to do with this?

I mean, if turnover stays the same and costs increase, this means profits decrease as well or perhaps this even means a loss if margins have been low already.

In any case, it’s not a situation you should accept just like that, however from my experience talking to sales professionals around the world, they struggle to discuss this with their customers because they also know how tough buyers can be.

They are scared to put these requests on the table. And I understand that all too well.

To help you with that, I’m here to provide you with an interesting provocation. Here goes:

‘Not asking for a price increase currently erodes trust with your buyer’.

There, I said it. But more interestingly, here’s why:

If you do not ask for a price increase in the current market situation, you are basically saying to your customer or buyer: “I can take a 5 or 6% inflationary hit on my margin, because margins were already good beforehand”.

As a buyer this would make me feel bad about our past dealings believing I have historically overpaid for the products or services you have provided. And that’s one of the worst feelings to have as a buyer.

Remember, a buyer never truly understands the cost structure of the product or service you provide. So, a lot of their decision making is a mixture of emotions and facts.

Therefore, it is always important to make them feel good about current ánd past dealings.

So, in case you were struggling to go and see your buyer. Just do it. They expect you to.

Happy negotiations everyone!