Sometimes in sales we may need to justify the price our customer needs to pay to enjoy our product or solution.
This is especially the case when you are selling high value products such as capital equipment or machinery.
The best way to address the potential ‘shock’ of a large price tag is to factor in the lifespan of your product – by dividing that period of time into your selling price.
This enables you to talk about an effective cost per day, per week, per month or even per year. Whichever period makes most sense for your product.
This breaks the overall price down into smaller units. Talking about those smaller amounts of expenditure helps to paint a better picture of the value you are providing to your customer.
It somehow seems cheaper to the customer too!
For example, let’s say your product has an effective lifespan of 3 years (36 months) and it costs $80 000.
Asking for $80 000 seems more expensive to your customer than talking about an effective expenditure of $2 300 per month for the use of your product.
(You may need to factor interest into the discussion, but often this isn’t required.)
The customer may still be paying $80 000 at the start of your agreement, but by discussing the cost to them as a monthly amount tends to make the sale move more rapidly due to the perceived value you are presenting.
The lower the figure you can discuss with your customer, whether it’s a cost per day, or a cost per transaction, the greater the value it appears to the customer and the easier it is to transact the sale.