December 2020
Does giving a discount win more deals?
December/2020/
Research by Proposify suggests that including a discount in a proposal does lead to a greater win rate, but only increases the win rate by 4%. The good news about giving a unilateral discount is that the other party feels that they have had a 'win'.
And the procurement team can log the discount as a saving and add it to their 'cost avoidance' savings log. The other good news is that tf the procurement team have another bite of the cherry and ask for a further discount (why not, you have already given a discount without being asked!) you can reply by saying "we've already given you a discount!"
The prevailing logic in negotiation is that "if they've moved once, they'll move again". So think had about giving a discount without getting something back in return. Proposify's research shows that discounts above 30% are negatively correlated with win rates. Double digit discounts may work for rug shops, but in business all that large discounts do is undermine the credibility of your initial offer.
Don't do it!
And the procurement team can log the discount as a saving and add it to their 'cost avoidance' savings log. The other good news is that tf the procurement team have another bite of the cherry and ask for a further discount (why not, you have already given a discount without being asked!) you can reply by saying "we've already given you a discount!"
The prevailing logic in negotiation is that "if they've moved once, they'll move again". So think had about giving a discount without getting something back in return. Proposify's research shows that discounts above 30% are negatively correlated with win rates. Double digit discounts may work for rug shops, but in business all that large discounts do is undermine the credibility of your initial offer.
Don't do it!