5 Surefire Ways to Overcome MSP Customer Pricing Objections

November 27th, 2017
Pete Langas
Pete LangasDirector, Sales & Business Development

You already know that your prospects have lots of options for computer and network services. Naturally, some of your competitors will try to court business by undercutting your price. From time to time, you’re bound to run into customers who don’t want to pay your prices and some that may even balk at the thought of any monthly fees. In the sense that price objections are one of the most common sales objections that any salespeople run into, selling managed services isn’t so different from other B2B sales.

Here’s the good news. Experienced salespeople will usually tell you that pricing objections are one of the easiest kinds of sales objections to overcome. Plenty of people pay more for quality, and business people who need managed services aren’t any different. So, without further adieu…

5 Solid Ways to Overcome Cost Objections

These five tested tips can help you convince your prospects that you’re offering them an excellent value:

  1. Understand the Value You Offer in Your Own Mind  

Yogi Berra said that baseball is 90 percent mental. Most good salespeople make a similar observation about their own profession. Before you can overcome your customer’s price objections, you’ve got to confidently overcome them in your own mind.

As a representative of a high-quality, growing managed services business, you shouldn’t waste time competing on price. You’ll just reduce your margins and risk hurting your reputation by cutting corners. You should never feel apologetic about charging enough to provide top-quality service and earn a fair profit.

winning msp customers

  1. Let Your Prospects Know Your Efforts Could Save Their Business

Let’s say that one value your MSP offers is professional security and recovery. Explain to your customers that recovery from an SMB data breach costs average from $36,000 to $50,000, and many small businesses can never recover. Describe a scenario where the employees login one morning to find ransomware has infected their network. You can even use this example of a small business ransomware attack from the Denver Post that resulted in the company’s failure.

Ask your prospect if he or she would know what to do if his systems were compromised. How much would the business suffer if it lost data, applications, and most of all, customer trust? Your charges will seem like a cheap price to pay for peace of mind.

  1. Explain Why You’re Different

You will find prospects who have already gathered price quotes from other providers, and they will probably tell you that XYZ MSP down the street charges 20 percent less than you do. If you don’t already know what services the cheaper provider offers, you can ask your prospect for a summary. Actually, successfully competing head-to-head with an apparently cheaper competitor simply comes down to differentiation.

At this point, you should not just tell your customers what services you provide; you should explain how you do them better than your competitor. For instance, you might offer 24/7 phone support, real-time security monitoring, or certified technicians. Let your customers know why they can’t afford to buy discount services.

pricing objections

  1. Let Your Prospects Know That Their Best Interest Is Also Your Best Interest

Find out how much your prospect’s company spends on the services you provide. Ask how much several hours of downtime costs them when they need to wait for repairs. Let your prospect know that your company’s main concern will be to keep their system running efficiently and smoothly because that reduces your own efforts and helps you maintain them as customers. Tell your customers that you plan to consider them partners and not just customers.

If your prospect only has break-and-fix services right now, explain that their current provider hopes something will break, so they can get paid to fix it. Your very different business model relies upon keeping things from breaking in the first place.

  1. Listen for Pain Points

Your prospect would not have agreed to a meeting or phone call if he was entirely satisfied with the status quo. If they says that their in-house servers and break-and-fix support typically cost less than what you’re offering, your first goal should be to uncover the reason that your prospect offered to take time out of the day to speak with you in the first place.

They might have concerns about security and backups, been frustrated because their current providers took too long to resolve a system glitch, or not been satisfied with recent server performance times. Whatever it is, you should listen to your prospect’s story and then act in a consultive way to offer solutions. This way, you’re not really selling; you’re consulting and problem solving. You can say, “As soon as we start providing you with service, we’ll implement these solutions…”

Always Sell Value Over Cost

Your prospects know how valuable their computer systems are to them. You don’t want your business to have to race to the bottom to compete with alternatives that may appear cheaper on the surface. If you always emphasize value over cost and let prospects know that their needs will become your priorities, you won’t have to compete on pricing. If you listen to your customer’s pain points and work collaboratively to provide solutions, you won’t really need to sell at all.

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