Sales People – 5 Reasons They Discount To Sell [2018]

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Sales People – 5 Reasons They Discount To Sell [2018]

Sales People

Sales People often provide discounts or incentives to buyers in order to help them hit sales targets and win more business.  Is this really necessary though?  This results in lower margins which can cripple the business rather than provide a profitable platform for growth.  Reducing or even better eliminating discounting by sales professionals, is in many ways one of the easiest ways to grow your business and maximize your profits.  There are many reasons people feel compelled to discount, and some of the reasons will be easier to overcome than others.  The following 5 reasons are a good place to start.

1)      Sales People have compensation /commission plans directly linked to gross sales, not margin.  Whilst the best sales professionals are not motivated by money, it does impact their sales behaviors and sales people need to be rewarded on margin not turnover.  Any discount given by sales people to the customer can be part or in whole taken from the compensation/commission pot.  Sales people therefore do not feel any pain when they discount.

2)      Sales People fail to differentiate their product or service, as when two products appear the same, the buyer will always choose the one with the lowest price.  Those who are beaten up on price simply need to learn what makes their product or service different in the eyes of the buyer.

3)      Sales people let buyers negotiate and the buyer negotiates better than the sales person.  As the world renowned negotiation expert Chester Karrass says “In life you don’t get what you deserve, you get what you negotiate”.  Negotiation in sales is like chess, and your buyer is simply a better chess player than you.

4)      Sales People get buyer empathy and want to “help” the buyer.  Those who have buyer empathy start to believe the buyers stalls and objections.  There is no doubt that the ability for people to empathize with buyers is a fantastic selling trait, but like every strength, when it becomes over extended that strength becomes a weakness.

5)      Sales People are “needy” and when the buyer can smell this weakness they prey on it.  Needy sales professionals are viewed by buyers as “desperate” and the buyer then uses this to their advantage.  The psychological need for approval inside all of us when left unchecked can cripple sales people.  In addition to discounting, people with a high need for approval agree to deadlines, terms and deliverables that are great for the customer but not for the business.

Sales people can change the way they sell and this starts with education, however nothing will prove as effective as real life experiences in the field.  Like everything in life the first time is always the worst, but the prize is definitely one worth fighting for.  I don’t believe sales people want to discount, they just haven’t been shown how to sell without it.  Interestingly, you will find in addition to the financial benefits Sales Professionals and the business receive from not discounting, the biggest benefit is the boost to the sales persons self-esteem and confidence.  Confidence is a huge part of selling and anything that boosts confidence is great value to the business.

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Sales People - 5 Reasons they Discount to Sell
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Sales People - 5 Reasons they Discount to Sell
This article explains the top 5 reasons that sales people give discounts in order to win new business and what you can do to resolve the problem.
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