Published January 8, 2013 | Updated October 9, 2019
Imagine this scenario: you’ve spent considerable time establishing rapport and building good communications with a prospect. You’ve dug into the business drivers and understand the needs of the prospect’s business and the problems that must be solved. Now you’re in the process of putting together a lucrative equipment transaction for the prospect based on features and benefits of your equipment. Soon you’ll be ready to pitch it – or will you?
You truly believe your solution offers tremendous value and will solve the problems on the table. As you’re wrapping up the sales presentation, you try one of the traditional, perhaps even dated, “trial closes.” You say something like, “So I think we can agree that this solution is right for your business. When would you like to take delivery?”
The thinking here is that if you’ve done everything correctly up to this point, there really isn’t much of a decision required. If the prospect has already bought into your sales pitch, the theory is that the sale has already been made and that it’s a done deal. But then the prospect comes back with the ultimate objection, even if it’s not really expressed as such. The prospect says, “Sounds great, but how much does it cost?”
Salespeople often lose their grip when they hear this question. They immediately start worrying that maybe their price is too high and that when they tell the prospect what it costs, they’ll lose the deal. So the first step is to find out why the question was even asked. Sometimes the answer becomes painfully obvious when you realize that at no point in the sales process did you tell the prospect what the price actually is. In this case the question is more of a glaring omission than a real objection.
In order to prevent this from happening and to preempt the issue of price as an objection altogether, it’s a much better idea to introduce price into the trial close but with a little twist. Instead of fumbling around with a big, intimidating number, it’s much easier to start the discussion around a particular payment and then work from there. And in the event that you have neglected to mention price up to this point, this technique will still work just as well.
Here’s an example of a trial close that uses a payment to hook the prospect. Let’s say you’re talking about a $25,000 equipment acquisition. Based on the residual value, applicable rate and term, you can offer the customer a payment of $220 per month. You also know that if you extend the term a bit you could get the payment down to $189. The trial close might now sound something like this:
“So I think we can agree that this solution is right for your business. Based on our attractive lease financing, your monthly payment would only be about $220. When do you want to take delivery?”
This approach does several things. First, it moves the subject of price away from a big number to a much smaller number. Second, by the way the question is framed you are presuming that the prospect is going to say yes. Experience shows that if you’ve managed the sales process correctly to this point, that is exactly what they are going to stay.
Third, if there is a price issue, you’re in a much safer place to talk about it without having to offer a discount. Talking in terms of hundreds of dollars is far less intimidating for many equipment buyers than talking about tens of thousands, and it’s a much easier number to negotiate from. More importantly, the lease payment can be adjusted by changing transaction variables like the term and buyout provisions. Using this approach, you can lower the payment without losing one penny of margin.
For example, suppose the prospect says, “Yes, I really need the equipment but $220 is a little out of my budget right now.”
You could immediately come back with, “Okay, we both agree that you need this equipment as soon as possible. So let’s extend the term for a year. If we do that, I can get the price down to $189 a month. When do you want it delivered?”
If you use this approach, you should never have to discount an equipment transaction again. By inserting more easily manageable lease payments into the sales discussion early on, you can completely eliminate price objections that can erode margins or cost you the transaction altogether.
Properly used, lease financing becomes much more than a simple payment method. It becomes a strategic advantage for a salesperson seeking to close more transactions. Lease financing is one of the best, most effective means of overcoming a fundamental objection based on price.