The 7 Deadly Sins of Discounting

Sales managers, directors, VP’s and executives! Have you ever considered the cost of discounting—the aggregate impact discounting has on your business, sales department or your own personal success as a sales leader? Without calculating the costs of discounts, how can you know whether or not the impact has been positive or negative? The answer to this question depends entirely on the costs of your discounts because even when you win with discounts—there’s still a cost, a trade-off. And for companies experiencing chronic discounting behaviors from their salespeople, or growing discounting trends in general, the costs can be significant. They’re certainly not trivial.
All price concessions risk the inadvertent, but nevertheless damaging effects of discounting. The “7 Deadly Sins of Discounting” risk:
Diminishing or eroding product value
Lowering, weakening or cheapening brand status
Establishing a justification or precedent for future discounts
Incentivizing, in fact, almost guaranteeing future discount demands by those same clients
Jeopardizing client trust in salespeople, products, and prices
And, of course, the obvious elephants in the room: Lower margins and…
Lower profitability
When calculating the costs of discounting, keep in mind that every discount goes to the bottom line of profitability, every time, no exceptions. In fact, in our Buyer-Side negotiation trainings to procurement officers, and professional buyers in general, we don’t even call them discounts, we call them donations. We teach buyers that the fastest way to put profitability into their pocket is to take it from the sellers—from unwitting salespeople who are untrained or unprepared to deal with trained, professional buyer negotiators. For example, we teach professional buyers 21 very specific buyer negotiation tactics, all aimed at securing discounts—from very simple to fairly sophisticated tactics. One very simple, elemental buyer tactic we teach is called “The Ask.” An embarrassingly effective buyer tactic when used against untrained sellers. Here it is, “Hey, would you mind dropping that price 5%?” …That’s it. And yet, that simple, almost sophomoric buyer tactic is devastatingly effective on untrained seller negotiators who aren’t prepared with an effective rejoinder or response. Or even aware of available countertactics. We teach sellers 12 specific countertactics, including 5 supertactics and 1 Alphatactic that are especially effective in neutralizing buyer tactics, and without jeopardizing the sale or relationship! Without being armed with seller counter tactics, salespeople frequently end up “mumbling, stumbling and fumbling” into discounting.
And is it any real wonder why? It’s because they’ve never been trained. They’ve never been taught or equipped with sales-specific negotiation skills and knowledge. And “If you don’t train em, you can’t blame em.” Keep in mind, the opposite is also true.
Patrick Henry International is an advanced sales and negotiation training company that helps salespeople and organizations win more sales, with fewer discounts and higher margins. Our trainings equip sales professionals with sales-specific negotiating skills and strategies that prevent the natural tendency of salespeople to discount TOO MUCH, TOO FAST and TOO OFTEN! We’ve delivered over 1,200 trainings to over 150,000 sales professionals representing hundreds of businesses WORLDWIDE that on average experience a 6.8% increase in annual sales and a 3.1% increase in sales margins. We’re confident we can achieve similar results for your business or sales organization.

If you’re interested in learning more about how Patrick’s Sales-Side Negotiation keynotes or trainings can help your business or sales organization increase sales, decrease discounts and improve profitability, call 888-PHI9232 or send an email to