Closing the Deal: Handling Customers Who Want To HaggleBy My Service Depot on Monday, May 15, 2017
Well, I am interested, but that price seems high. Can you give me a better deal?
Anyone who has sales experience in the HVAC industry has almost certainly heard these words (or others like them) while negotiating with a potential customer. To be frequently undervalued is an unfortunate side effect of the lack of understanding the typical person has of the HVAC industry. HVAC services are required infrequently and often the expense is unanticipated, so the primary concern for most customers is to get the job done as quickly and cost-effectively as possible. When considering this, one begins to see why we commonly come across inquirers who take a hardline stance and try to haggle away your profit margins. As a company, you should handle situations like these carefully. While it can be appropriate in certain cases to adjust rates to close a sale, we also want to be very careful not to devalue the services we offer. Below we’ve laid out some common pratfalls to avoid when addressing a haggling customer. We’ve also suggested a few alternative strategies to consider putting to use.
Don’t Let Low Perceived Value of HVAC Services Personally Offend You
When a customer rebuffs the quoted price you’ve offered and gives a counteroffer that devalues your services, you might naturally take it as an affront. After all, customers effectively question the worth of your company and the work you do when they do this. Perhaps they have not considered the various costs that you expend to do the job properly. Maybe they don’t have a good understanding of the hours needed to complete the task. You might immediately slide into a defensive position when a potential customer calls your price into question, but don’t respond to their queries with hostility. “When under attack, most people’s natural response is to defend themselves or to counterattack,” Thomas C Keiser said in Harvard Business Review. “For a salesperson in a negotiation, either of these actions will escalate into a heated disagreement.”
Instead, Keiser says, opt for an “assertive pacifist” approach. Avoid rebutting them, address their issues and questions as best you can, but don’t give in and lower your rate. You want to stand your ground and come to an agreement, not get taken advantage of.
Listen To Their Concerns Regarding Your HVAC Service Rates
Utilize the “assertive pacifist” approach correctly to effectively address customer objections. Attempt to achieve some level of mutual understanding. Remain attentive and give the haggling customer a chance to fully explain why they believe your rate is too high. Staying calm and collected not only diffuses potential anger, it also gives you an opportunity to uncover the pain points at the root of their objections. Perhaps they know they will struggle to stay within their monthly budgetary limitations. In this case, simply offering a little extra flexibility in terms of financing will ease their aggression without sacrificing your margins.
Steer the Conversation With Targeted Questions
Now that you’ve listened to their objections, ask thoughtful questions. If they assert that “your rate is too expensive,” try asking about their budget, and discuss with the client what both parties can accomplish within this constraint. Use non-provocative language. Remember that the client likely does not have a full perspective or appreciation of the HVAC industry, and rebuking them will never lead to successful resolution. Acknowledging their concerns and digging deeper with targeted questions shows them that you have an interest in working with them to come to an agreement, without conceding ground on your margins.
Record Any Discounted Services in the Customer’s File
If you do ever decide to discount a service for a customer, make a note of it in your HVAC software. If the customer tries to haggle again in the future for a service you already discounted, you will want to have this information available so that you don’t undercut your profit even more. Also, if a customer grows used to receiving a particular service at a special rate, you will want your team to have this information readily accessible the next time they call. Using an HVAC software solution will allow you to easily keep track of this customer information so it doesn’t get lost in a sea of paperwork.
Easy Steps to Avoid Haggling in the Future
There exist some proactive actions your HVAC company can take to avoid haggling with customers in the future. Itemizing your invoices will allow customers to see a breakdown of costs and services provided. Seeing this breakdown provides an unspoken sense of value while providing less room for arguing about total costs. Accurate billing can also prevent sticker shock in the future, sticker shock that leads to haggling. If you have ever under-billed in the past because of an inaccurate invoice, that mistake could cost you in the future if your customer assumes the same cost for the same service. Ensure that you have an efficient process in place for documenting any additional work done by your techs and always collect customer signatures at the end of the job. Equipping your HVAC technicians with a field service mobile app can empower your team to record updates and close out the necessary paperwork quickly and easily.
There will certainly be times where the best course of action is to say no and walk away from a haggling customer, but this is not an ideal solution for both parties. If used too often, this practice can have negative long-term consequences. Instead, treat customer concerns as valid. When a new client makes an attempt to haggle on price for your HVAC services, the way you respond will set the tone for your business relationship moving forward. Responding correctly can make the difference between retaining a loyal customer and getting a poor review on social media. Handle these important situations with care.