Negotiation starts long before anyone talks about price. Salespeople who did thorough discovery and know the cost of the buyer's problem negotiate from strength. Those who didn't end up defending a number they can't justify.
Prepare before you meet
Write down four things before any negotiation:
- Your target: the deal you want.
- Your walk-away point: the least you'll accept, including price, term and payment terms.
- Your tradeable items: things that are cheap for you and valuable to them (onboarding help, training sessions, a slightly longer trial, payment timing).
- What you want in return: a longer contract, faster signature, a case study, a reference call, more users, upfront payment.
Also think about the buyer's alternatives. If they walk away, what will they do instead? The weaker their alternative, the stronger your position.
Anchor with value
Before discussing price, restate the value in the buyer's numbers:
"You told me month-end costs your team about 120 hours a month. At your rates that's around $60,000 a year. Our proposal is $18,000."
The buyer now compares your price with the cost of the problem, not with zero.
Trade, don't give
Never give a discount for nothing. Every concession should get something back.
"I can look at the price if we can make it a two-year agreement."
"If you can sign by the 30th, I can include the onboarding package."
Giving discounts for free teaches the buyer that pushing works, and they'll push again.
Handle discount requests calmly
When a buyer asks for a discount, don't answer immediately. Ask a question first:
- "What's driving the request?"
- "If we could get the price right, are you ready to move forward?"
- "Is it the total, the monthly amount or the timing that's the problem?"
Sometimes the issue is cash flow, not price, and quarterly payments solve it without a discount.
Working with procurement
Procurement teams are paid to reduce cost. Their pushback is part of the job, not a sign the deal is in trouble.
- Keep your champion and the economic buyer involved; procurement rarely decides alone.
- Ask early about their process, standard terms and timelines.
- Expect a request for a discount and plan your trade in advance.
- Stay friendly and patient. Rushing at the end gives away margin.
Useful phrases
- "That's not something I can do, but here's what I can do."
- "Help me understand how you arrived at that number."
- "If I could do that, what would you be able to do for me?"
- "Let's set price aside for a moment and make sure the scope is right."
Know when to walk away
If the deal falls below your walk-away point, say so politely and leave the door open. A bad deal takes up the same time as a good one, and sets a price that's hard to raise at renewal.