When you are asked to cut your price, do you insist on something in return?

1. It’s something we get asked all the time – can you revise your pricing?
   1. People ask us to trim pricing – it’s almost considered a norm
   2. Why is it common in construction? I don’t know
   3. We need to be prepared for it
2. Why are they asking – it’s good to understand where the client is coming from
   1. Do they have a basis of support for the request
      1. Lower pricing by others? A lower budget?
   2. Are they just trying to improve their margins?
   3. What is the stage of the negotiations? Are they ready to sign the contract if you agree
3. Good negotiations require preparation
   1. Be ready for the request
      1. We don’t have to be like car salesmen with a whole routine, but we should have a plan
   2. Don’t go too far into negotiations unless they are ready to sign
   3. Don’t drop your price without some concession from thier side
      1. Change in scope / contingency /schedule / pay terms / mobilization money / etc.
      2. Always get something in return for lowering your price

Key Questions:

1. Do you plan ahead for negotiations?

2. Do you routinely drop your price to get the job?

3. Do you get something in return?

4. How can you improve?

Take-Action Items:

1. Prepare for negotiations

2. Add some contingency when you can

3. Always get something in return