Blueberry

Enterprise Account Manager

Is it wrong/unethical to sell above list price?

I feel like integrity is an important part of a salesperson’s role (despite what our reputation in this profession may be); especially when we have long-term, re-occurring relationships with customers (I'm in SaaS/Account Management).

I also know that people will destroy deals and relationships when they feel like they’ve been treated unfairly (Chris Voss talks about this in "Never Split the Difference").

I also know hitting quota is an important part of our role.

Do you think it’s wrong to charge above list price? Does this go against the integrity we should hold as sales professionals?

Context: I'm at a private company without a public list price, but also understand that occasionally customers talk & compare notes.

☁️ Software Tech

12 comments

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someoneinsales

Tycoon

Director of Sales

IMO it isn’t as black and white as above list price. Especially if you are at an early stage start up that will be raising its price a year from now anyways. If it is just to hit quota, maybe try to upsell them into buying more for growth up front if you feel wrong about selling higher than your companies list price. If they aren’t into that, then technically, list price for private companies are guidelines set forth by leadership.

sales7

Politicker

Commercial Product Enablement

If it's not listed I wouldn't worry, value based pricing for smaller companies makes more sense IMO

1nbatopshotfan

Politicker

Sales

It’s not unethical at all. It’s about the value you are providing to the client. Price accordingly.

CharmingSalesGal

Politicker

Account Executive

@1nbatopshotfan Couldn't agree more! I price over list EVERY single time. Not only does it give me flexibility to negotiate without approval if they want to play that game but it also gives me the opportunity to raise my average deal size.

One thing I think I'm really good at is researching the companies I am quoting. I use metrics like their average deal size, company earnings, total employees to help justify the cost of our product. If it only takes one extra sale per sales rep to pay for the platform and our platform can help gain multiple new sales a year, it makes sense to charge them a little more because it's ALL about the value you portray.

LordOfWar

Tycoon

Blow it up

Yes, I do this with select customers too. Price high then fall back to list if they push, works well with those difficult ones who just HAVE to get a deal to feel like they won something.

CharmingSalesGal

Politicker

Account Executive

Dealing with this type of person today. Super refreshing when you hold your ground and say no and they text, call and email you immediately basically begging for forgiveness. 😂

Ozz

Politicker

Account Executive

Not unethical - we used to raise our prices for international customers because they always wanted a small discount. What ended up happening was they were paying more for the software because of their practices. They didn't seem to mind.

CuriousFox

WR Officer

🦊

Not unless you try to do it on a GPO that states you cannot.

CaneWolf

Politicker

Call me what you want, just sign the damn contract

Consider the list price is made up half the time anyway...no. But you need to think very carefully about possible problems as a result. You mentioned it with customers comparing pricing but you could also hurt upsell opportunity for instance as well.

LordStacks

Opinionated

Account Executive

Yes and no. We have a publicly listed price, so it's different to your case but in my opinion the list price is already set up in a way that your company is happy with the profit margins.

You are absolutely correct that customers will compare notes, so these tactics are usually very short-lived. Some of our customers might get slightly better deals, depending on the size of the package and that is easy to explain to their friends and colleagues. If people are purchasing an identical package and the price differs significantly, you will simply end up loosing business in the future.

Just my 2 cents on the above but I know a lot of salespeople who like taking "every dollar they can get" but I've seen them burn way too many deals that way.

mitts2

Politicker

Account Executive

Regardless if your company has a list price or not, your pricing needs to be defensible. If you are proposing above list price but the ROI is massive, that is still defensible.

My company does not have a list price but there are a ton of other similar companies in my space where we need to be conscious of how other partners are pricing for this particular client. Pricing take in tons of factors other than just $$$. Do your research and if you can defend it, propose it.

HappyGilmore

Politicker

Account Executive

I think if you're padding by a small amount its okay, as long as your prospect understands the value of what you're selling. Now if you pad the list price by an exuberant amount above the list price, then that becomes unethical.

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Blueberry

Is it wrong/unethical to sell above list price?

12 comments

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