Price is still the most universal determiner and the most easily understood rationale for whether one purchases or does not purchase a good or service. Most people default to price to make a buy/sell decision.
The price one pays for a product or service is determined by many things: supply, demand, quality, desire, peer pressure, momentary impulse. The variations are limitless. Some folks unquestioningly pay list prices while others feel compelled to bargain a price down no matter how low it already is. But what if you are the seller. How low do you go?
Benjamin Franklin had a unique bargaining style. When someone suggested a lower his price for his product, Franklin would counter with an even higher price. The harder the bargainer would try to get his price down the higher Mr. Franklin’s selling price became. Franklin’s customers soon learned that attempts to lower his selling prices became very costly.
Here are my pricing rules. First I set a fair price. That means my costs are covered and my profit margin is competitive. I never price artificially high to give me bargaining room and I NEVER lower my price arbitrarily. If my customer needs a lower price I will do my best to accommodate the request but only if the buyer is prepared to give something up too. For example my unit price might come down if the buyer orders more (economy of scale). Or, my price might come down if the buyer orders the model with fewer luxury features. I may be able to help my prospect spread his purchase over a longer period of time to make things more cash flow friendly, or I may be able to combine his order with the order of another buyer to trigger a volume discount for both customers. There are many ways to work collaboratively with a buyer that do not involve arbitrary price reductions.
Anyone who lowers a price without obvious justifications a buyer can appreciate risks their honour or the profit every company needs to keep its doors open.