Avoid the Price War

I get this question a lot from agents, “What should we do when a prospect is going to show our estimate to the current competitor to see if our rate can be matched?”  Let’s use this specific example:  a customer had been with the current provider for three years.  We could offer a savings of $180 per month.  Here is how I handle this situation.  I say something similar to these statements every time I leave an estimate with a merchant. The merchant may not say he or she is going to show it to the current processor.  However, if you leave without closing the deal, there is a really good chance the merchant will show your estimate to the current provider.

“Bob, I showed you that I could save you $180 plus per month over what you are currently paying XYZ Processing.  That means one of two things:  (1) Their cost structure doesn’t allow them to match my price.  This would be logical since I am a direct provider rather than a third party.  If they can’t match my rate, you would obviously want to switch over to me, correct?”  Bob answers “yes.”

I continue, “(2) The other possibility is actually much worse.  They may immediately agree to match my price in an effort to keep your business.  Then you would know they’ve been overcharging you for these services by $180 per month for the last three years!  They have literally taken ($180 x 36) $6,400 in excess profit for their service when they could have easily saved you that money.  If this is the case, and they are unwilling to refund the $6,400 in overcharges, I’m sure you would never consider staying with such a company;  would you?”

I hope this short tip helps you in the field!

James Shepherd

james@ccsalespro.com

Read previous post:  5 Prospecting Tips – How to Prospect for Small Business Clients

5 Prospecting Tips – How to Prospect for Small Business Clients

Read next post:  Can I make 100K per year selling merchant services?

Can I make 100K per year selling merchant services?