The Price Build Up

Through training at the Southwestern Company, I’ve learned many of the best selling techniques in business.  This is one of the best “The Price Build Up”.

The price build up is something that anyone can use whenever they have to deliver the price to the potential customer. If you have people ask you how much your service or product cost, then this technique is for you!

There are three steps in this technique, and it is very efficient and effective for getting people to wrap their mind around the value of your service and making them feel as if the price is the best one that is out there on the market.

Step 1:  To start with, you want to build the price up. You do that by researching and finding out how much your product costs in other industries or other markets. How much is your competition charging?  For example, if you are selling a high-end pen and you know that your pen is not the most expensive and there are more sets of pens out there, find the most expensive one. For example, a Mon Blanc pen costs two hundred and fifty dollars and our pen only cost two hundred dollars. That is a good price comparison for you to have.

Step 2:  Then you do the next step of price build up which is dropping the bottom out of the price. And how you drop the bottom out is you say, “the main reason why people like to do business with us is that instead of being $3000 or $2500 or even $2000 per month, for our service it is only $475, that’s not bad is it?” Once you say that, the psychology is such that they are thinking $3000, $2500, or even $2000 the next logical order of sequence would be $1,500. By saying $497 it drops the bottom out of what they think it is going to be.

Step 3: The next step, step number three of the price build up, is attaching emotion to the price. Have some kind of story that one of your customers has given you in the past were they gave you a story about how they are so thankful for using your service. A good example would be with insurance; if somebody took advantage of your service and ended up having to use your insurance, tell a story about that right after you deliver the price.

 If you complete those three steps successfully, where you build the price up and make them feel it is going to be worth the value much greater than it actually is. Then you drop the bottom out of the price and, finally, attach an emotional connection to the value of the price, you will consistently have people tell you “that is not bad” regardless of what your price point is.

For more sales insight and success stories about implementing the tips you find here, check out the resources at the Southwestern Company. 


9 Responses to “The Price Build Up”

  1. This will help me in the jewelry business! Thanks!

  2. Good article bro.

  3. You are right Dustin. That technique is usefull no matter what industry we work in, no matter what we seel, no matter who we sell to, no matter how much our product or service cost. Thanks for such a valuable input.
    Also I want to say THANK YOU for all the sales advices you freely give through this blog. THANKS Dustin!

  4. What do you do if your products are the ones that are typically more expensive that the competition? you can’t easily ‘drop the bottom out’? what do you suggest for that?

    • Great question! When you are offering the top of the line service/ product you want to put the focus on the quality and longevity of what’s being provided.
      For example if you’re selling high end carpet your price build up could be “Useually when people find out that our carpet last 4 times longer than any of our competitors they think it’s going to be 4 times the price. I think the main reason everyone does business with us is that you get 4 times the life of your carpet and instead of being $500 per square foot, it’s only $350! That’s not bad is it?! No, it’s like Bill Hammer was saying that if the carpet last 4 times as long as any other carpet this is an investment that eventually ends up putting money back into his pocket… in addition to having a far superior quality and color options.”

      Of cource you’ll have to customize this to your industry, but I hope that helps.


      • super helpful, Dustin. Just what I needed to break through on a pitch I’m writing while pretty brain-dead at 5AM day before the presentation!

        SW Alum ’98-’99

  5. peter hiikyaa Says:

    very impressive. love your analysis.

  6. Everything is very open with a precise clarification of the challenges.
    It was definitely informative. Your site is very helpful.
    Thanks for sharing!

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