How To Respond to a Negotiable Price Request (With Examples)

Updated December 30, 2022

In sales and business, the price of a product or service can fluctuate with discounts, promotions or price negotiation. Price negotiable is a concept customers or businesses employ to secure cost savings, larger quantities of sales or a competitive reputation. Learning more about price negotiable methods and how to use them can help you develop professional skills in sales and business. In this article, we define what price negotiation is and explore eight steps on how to respond when customers negotiate price, including example suggestions for what to say.

What is price negotiable?

Price negotiable is a sales description of an item, product or service that has a price not firmly established. For example, a new or used vehicle has a suggested purchase price, though often it's negotiable, especially with factors like trade-in vehicles, financing or leasing. Price negotiation specifically is a stage of the sales process where customers are interested but not ready to buy because they want a better price or additional value. In business, price negotiable can get applied to nearly any industry or item, though it's more common for large quantity purchases or for estimates, like construction costs.

How to respond to a customer's price negotiation request

Customers often inquire if a price is negotiable, even when an item or service is priced fairly, and depending on their needs and wants, negotiating can help you establish a long-lasting customer relationship, build a competitive business reputation and preserve the interests of your company. Here are eight ways you can respond to a customer's request for price negotiation to keep their business, close a sale and maintain your revenue and reputation:

1. Share the lowest terms you can offer and add variables

Explain to the customer what minimum price you can offer and add variables and options, like flexible payments, different feature packages or a more affordable model. Sometimes the more options a customer has, the more likely they are to make a purchase when they feel you're negotiating with them and that they're getting a good deal. Maintaining a friendly and positive demeanor that shows a willingness to negotiate can help you keep the customer engaged.

Here's an example email from a sales representative using this strategy to respond to a request for a lower price on software equipment:

Example: "That's the lowest I can offer for that specific software package, though we offer monthly and quarterly payment plans to make the full cost more manageable. If there are software features you aren't planning to use, we likely have another software package that suits your needs at a lower price. Let's connect to review these options in more detail to see which works best for you."

2. Examine why they want to negotiate and actively listen

Inquire with your customer about why they want to negotiate the price and actively listen to their answer to identify issues or challenges to overcome. For example, a small business owner may request a lower price because they're waiting for loan approval or experienced hardship in their family. Asking and listening also show a vested interest in your customer, letting them know you value their business, which can lead to a sale or even a full-price purchase.

Regardless of the reasons a customer gives for asking if a price is negotiable, consider reacting with calm positivity, keeping the conversation productive and professional. Even if a sale doesn't take place, a professional interaction is important to future business and word-of-mouth sharing. Consider these suggested questions to engage a customer with during price negotiations:

"Might you be able to elaborate on how a lower price helps?"
"While we rarely offer discounts, I'd like to understand what price point works best for you and how it makes an impact."
"Is price the only thing hindering the sale for you?"
"Please let me know what I can do to leave you as a satisfied customer today with a sale."
"Are there any circumstances in which my initial offer is worthwhile for you?"
"Depending on the situation you're in, I'd be happy to ask my supervisor about rate reductions as a workable solution."

3. Focus on the simplest issue first

Focus on concerns that are easy to fix, like waiving shipping costs or offering free returns, for example. By addressing the simpler issues first, you can make progress toward solving the more challenging dilemmas while gaining momentum. Plus, showing customers you can creatively find solutions to minor concerns may help you earn their overall trust and reveal new information to help determine the right approach for larger issues. Consider using a genuine and authentic tone when sharing information and responding to customers to further establish your workable approach.

4. Trade discounts for concessions

Because sales are often about forming long-term customer relationships, balancing expectations is important. Depending on the situation, consider asking for concessions in return rather than offering a lower price initially. In exchange for price negotiation, you can make both tactical and strategic modifications to your agreement without altering the price. For example, you can offer a free follow-up service that a customer feels adds value to a sale, adjust a timeline for when work gets completed to give the perception of a bonus or offer flexible payment arrangements. Other aspects where you can make tactical and strategic changes include:

Contract terms
Conditions of purchase
Amount of features
Product volume

5. Convince them of the value of your product

You can often convince your customer of your product's valuable by explaining the impact of not buying it. Showcasing what a customer loses as opposed to what they gain from your goods or services can increase their interest or urgency to buy at your offered price. Perhaps your customer might lose revenue without having your product or spend more on production costs. Framing your value to highlight fair pricing may persuade a customer to agree without negotiating the price. Here are some suggestions for this method:

"The amount you'd save on inventory and shipment costs means you're losing money right now without our service, plus we offer free post-installation consultations."
"Your team can enjoy less paperwork with our system and easy access, even remotely—a great savings in labor costs, supplies and effort."
"When you consider the lower acquisition cost and increased value you make per customer, this is a fair price that pays for itself typically within a year."
"Other clients who use our system see a 15% average increase in customer referrals within the first three months."
"We can activate the system for your use the same day we close the sale, so your shipping costs go down immediately."

6. Negotiate as long as possible

It's helpful to have conversations with the customer or client, even if both parties share offers back-and-forth. It often gives you more options, shows you're agreeable to reaching a compromise with a customer and can establish or grow a reputation of being a sales associate or company that values relationships more than revenue. Be mindful so you know when to close the sale or give the last offer if you feel the customer is tired of the conversation.

7. Talk about future transactions

If a customer ultimately isn't receptive to any offers, shift the conversation toward future dialogue and business. Perhaps the customer needs to run a price by other leaders or the next quarter's budget has more money to buy the item, for example. Keeping the possibility of a sale open is just as important as making one, so offer to connect at a future time to see if they're interested then. Here's an email example a sales representative might send when they feel the need to postpone a sale conversation:

Example: "While I know our printing software solution would be great for your business, it's important for you to be ready. We've made a lot of progress in learning about your business and budget needs, so let's stay in touch and connect next month to see if leaders are ready to invest. I've marked my calendar to speak with you then and am looking forward to it. Thank you."

8. Prioritize the relationship

Price negotiations are opportunities to earn and show respect and establish and grow business relationships. Sales that aren't closed now can be future opportunities, and the connections you make through negotiations have value. Remember to prioritize the professional relationship first, rather than the sale. By focusing on your customer's needs, you can instill trust and potentially earn a lifelong client.