Stagflation is the new buzzword these days. It means growing inflation combined with slow economic growth.
As essential and raw materials increase in cost due to macro-economic and political factors, manufacturers and suppliers need to pass on price increases to their customers. Many are looking for a way to announce these necessary price increases without upsetting customers or prospects ready to sign a contract.
It's a recurring situation whenever there's a severe rumble in the world!
As painful as it may be to announce the unpleasant message, it's a must-do!
So how do you handle the increase when you know that your sales department will probably start objecting to this?
Here are some practical approaches on how to deal with this tricky issue:
First, deal with it internally: set up a communication strategy to inform about the reason for the increase. Get people engaged and involve co-workers in coming up with ideas about how to announce the news to customers and, at the same time, soften the pain. Show appreciation for their ideas and use these in the information campaign to your market.
Prepare and train your salespeople on how to sell the price increase. The message needs to be clear, informative, and transparent. The fact is that your organisation will probably not be the only one dealing with this.
Involve your marketing department with sales in brainstorming, designing and executing a professional message to the market.
Create awareness of your product or service's value to your customers and connect this value to what is important to them and their business.
Prepare and train on handling objections to the increase and avoid excuse-making. Excuse making can only lead to non-acceptance or, worse, customer departure!
This exercise should include your sales department and customer service desk, as they deal with objections of/or disgruntled customers.
Decide on which customers need to be informed personally through face-to-face meetings or video conferences.
Then, contact your customers and inform them about the price increase and why.
Check and double-check if your message had a professional and credible impact. You can do this by using a short survey after delivery of the price increase to get feedback.
Interacting with customers, especially in price increases and other challenges, can be risky, especially when your co-workers are not well-prepared. If you want to know about best practices and how you can deal in the best way, contact me here.
You can also call me at +31 (0)642713033