Situations · Negotiation
When a major customer pushes on price, find out their alternatives and internal constraints first, then decide whether to cut, trade, or walk. Three conclusions, common mistakes, and three plays.
A customer pushing on price is not a customer leaving. Most price pressure is a routine procurement step whose goal is a result that looks good when reported upward.
Before conceding, answer: what it would really cost them to replace you, who they have to answer to internally, and whether they want a lower price or a reason they can defend.
The right response is usually not a lower unit price but a changed exchange: a longer contract, more volume, better payment terms, or less customization, so the concession buys something.
Also searching for: customer demands discount · customer asking for lower price how to respond · key account price pressure · negotiating price with a big customer
Hearing that someone else quoted lower and panicking, forgetting that if they could switch easily they already would have.
The unit price drops and nothing else changes. That is a gift, not a deal.
Give everything in the first round and they will assume there is more, and push again next time.
If you do not know your floor, you have no leverage at the table.
Switching suppliers means re-qualification, retraining, and delivery risk. Those switching costs are your leverage. Quantify them first.
Procurement has to report to a boss; operations has to avoid supply gaps. Work out who really decides and what they fear most.
At their price, does this order still make money and is it worth the capacity? An order below your floor costs more to win than to lose.
The Art of War, chapter 3, Attack by Stratagem
Know the enemy and know yourself, and in a hundred battles you will never be in peril.
Knowing the other side at the table does not mean guessing what they want. It means learning their constraints, alternatives, and who they answer to. Once you know these, price pressure stops being a threat and becomes an exchange you can design.
Offer a conditional reduction tied to a longer contract, higher volume, or less customization. They get a result; you get certainty.
Hold the unit price and offer a non-price concession they can report: a free training session, a faster response tier, one quarter of extended payment terms.
Say plainly that it does not work, offer the lowest configuration you can deliver at that price, and make clear you want to keep the relationship. Many customers come back within weeks.
Tell the strategist the situation: who the customer is, what they are asking, where your cost line sits, and what you know about their side.
The strategist first asks about what you do not know, their alternatives and who they report to, then lays out both sides' leverage in one comparison.
You leave with a one-sentence reply plan and a boundary that tells you when to walk away.
This page covers the order of judgement. Your own situation, opponent, and resources are worked through with the strategist in the app.
Get the app and run your situationNeither deny nor match. Ask what scope, delivery, and service level that quote includes. In most cases the scope differs. Bring the comparison back to the same baseline before discussing price.
It depends on their switching cost. If replacing you means re-qualification, retraining, and supply risk, they will not switch for 10%. If switching is cheap, you were only ever a price supplier and the account was going to leave eventually.
Every concession should buy a condition. Never concede unconditionally. Make each step smaller than the last so the other side can tell you are near the floor.
A long-standing customer's value is stability and trust, so you can, but turn the concession into an exchange: a longer renewal, clearer demand forecasts, or better payment terms.
Negotiation · When a negotiation stalls, find each side's walk-away option and real red lines, then change what is being exchanged instead of pushing the same term again.
Negotiation · When payment terms will not close, price the cost of the money sitting with the other side, then split the terms with instalments, discounts, or guarantees instead of fighting over days.
Negotiation · Before asking for a raise, work out what makes you hard to replace, what the market pays, and what your manager needs to get it approved, then pick the moment.
Negotiation · When a partner asks for more equity, work out whether they want recognition, control, or income, then use vesting, milestone adjustments, or profit share instead of a one-off transfer.
This page covers the order of judgement and is not legal or financial advice. Negotiations involving contract terms, non-compete clauses, or antitrust rules require qualified professionals.