How do you tell the difference between an offer that is "more expensive" and one that is "too expensive"?
In a crisis period such as the one we are currently experiencing, purchasing directors and hunters of unnecessary costs are more in the spotlight than ever. While the need to cut costs may seem obvious for companies, this logic should not be allowed to take hold in a way that imposes a "low cost" culture and sacrifices client-supplier relationships. "Cutting costs" should not become the sole objective, because behind any price there is always a wealth of information, and before making a decision, the buyer must make the effort to scrutinise an offer and not stop at the single signal sent by the price tag. Conversely, the seller must redouble their efforts to ensure the transparency of their offer. But how, then, does one distinguish between the "more expensive" and the "too expensive"?
The limits of price: the constrained purchase
There is a first version of "You are too expensive" against which it is pointless to fight. It is the one that actually means "you are more expensive than your competitor." This is the buyer who is solely in search of a bargain, whose only goal is to get a good deal — for reasons that are their own business. This version is what one might call the subjective form of "You are too expensive." The buyer's reasons can be many: their company lacks the budget, they are aiming for a high margin, their business model imposes certain constraints. Faced with such arguments, it is up to the company to adapt and see whether it can meet the demand — whether it can lower its costs and adjust its pricing competitiveness, knowing that these constraints will inevitably impact quality and timelines.
With a little perspective, one can see that it is precisely this kind of objective that gave rise to offshoring strategies and pushed companies to source internationally what was too costly to produce locally. It is in this logic, for example, that some Swiss watchmakers, in order to survive and continue reaching the general public, began producing components outside our borders.
Analysing this model, one ultimately finds that the values at play are rather thin: everything that matters is contained in the offer itself. It is a purely functional purchase. It is easy to assume that a low-cost product has a shorter lifespan or reduced functionality — but this phenomenon is even more pronounced in the context of a service, where the non-quantifiable element is more significant.
Tenders perfectly illustrate this situation: in such cases, only price matters and all other parameters are set aside. It amounts to comparing apples with apples without taking their flavour into account.
Beyond price: the investment
There is a second version of "You are too expensive" that is far more interesting in terms of the client-supplier relationship — one that gives the seller the opportunity to persuade the buyer of the legitimacy of their pricing policy and offers them the chance to clarify the value of their offer and explain its rationale.
This is the key to accessing a full range of services and the world of values that comes with them: meeting deadlines, quality, post-development management, after-sales service… The buyer knows that their purchase price includes parameters such as the time required to transfer knowledge, the time spent managing the project, and the quality of the deliverables (prototype, report…). One should remember, for example, that a prototype serving as an operational demonstrator is something one is not afraid to show to potential clients: reliable, well-designed…
The client knows they will benefit from significant advantages. None of this is arbitrary — quite the contrary — and it is up to the service provider to offer the necessary guarantees of trust, persuasive enough to allow the client to sleep soundly at night.
Most major brands have built their client relationships on this model. Apple fans pay a premium to have a well-designed, turnkey product free of viruses. They have all had user experiences that allowed them to understand that they were not "paying too much" and that they were investing not only in products but also in the brand's equity. A logic that can be applied to any company, including high-end service SMEs, since each one is capable of embodying the values of trust and longevity that form the foundation of a strong, lasting relationship.
Just as a "good buyer" must question an extraordinarily low price and be wary of hidden defects, they must equally be capable of detecting the "hidden virtues" behind an apparently high price.
And while the excited amateur will throw their hands in the air, the seasoned professional will be an informed judge of the stated price — and will ultimately not find it "too expensive" at all.
