Big Mistake on Pricing

We Made a Big Mistake on Pricing… Help!

Written By:

Lynn Whitbeck

My company made a big mistake on the pricing of an order for a new client. Now I must go back and renegotiate the pricing. What is the best approach so I don’t lose the order and client? – Eleanor in Plymouth Meeting, Pennsylvania

Answer:

We all know mistakes happen. They are a great opportunity to strengthen your relationships when managed promptly, alongside empathy, and with viable solutions. It’s crucial to get out in front of missteps immediately. You need to quickly assess what happened, determine how you will fix it, and then make it happen.

First Step

Understanding what happened is the first step: how and why? Translate what occurred from tech-speak to an easily digestible single sentence. Keep the tone positive and factual, no recriminations or blame. Keep in mind that even if your client has technical expertise, they will likely need to run the possible solutions up the ladder. A succinct and understandable explanation will help your contact communicate with their team and manager.

Second Step

Explore possible options and solutions to remedy the situation. Brainstorm with your management and production teams. In the case of a pricing error, probe how and where you could shave costs without compromising the end product. Can you substitute materials, eliminate steps, streamline the process, extend the delivery, or manufacture on your swing/graveyard shifts? Establish the three best options which are mutually beneficial, and attain your own management’s buy-in with each solution.

Ask Lynn - Big Mistake

Third Step

Contact your client and inform them of the question which has arisen. If at all possible, schedule a same-day in-person meeting to review the viable options. Present physical samples or examples for their review, if appropriate, as a potential solution. If an in-person meeting is not possible, use a video call. Making to eye-to-eye contact will help tremendously to read their non-verbal cues during the conversation. My advice is the same whether in person, on a video call, or over the phone: be honest, genuine, and prepared.

Sincerely apologize for the mistake, but don’t dwell on it. Move forward to the remedies available. Present the options and ask for their input. If necessary, be prepared to help the client find an alternate resource for the order. You may choose to have your manager present to demonstrate how seriously your firm values your client’s business. This will also enable immediate approval of any modifications requested by the client for swift resolution.

Final Step

After the required outcome has been agreed upon, make it happen. Pay close attention to the project throughout production, shipping, and follow-up. Your extra care will ensure no further missteps occur to muddy the waters. Provide ongoing brief updates to your client on the project progress – they will appreciate your watching their back.

If for any reason the client decides to pull the project, show your empathy with prompt and professional compliance. Even though this is not a desired outcome from your perspective, you can still use it to establish your credibility and responsiveness.

Managing difficult situations can bolster your relationships. In fact, knowing how you handle a mistake can increase client trust. The key in your approach is to be proactive, be honest, and perform the heavy lifting to overcome the obstacle. Following the four steps I have outlined is a mutually beneficial map, creating a win-win for you and your customer.

Resources

“Recovering From a Misstep” – Podcast

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