Knowing your competition helps you to understand the market and what you are competing against. When a prospect comes to you, you have an opportunity to position yourself as an expert. You're closest to the market and know all the options. You want them to come to you with questions as an advisor. Be honest and handle those questions well.
If you're competitor does something well, acknowledge it. Then discuss what your product/service offers instead. Help the prospect to make an informed decision.
In each of our industries we have overhead, hard dollar costs and we want to make a fair profit. Your competition is in the same boat. If their pricing is significantly lower, something's going on and you want to know what it is.
- They may be buying the market - offering services at a loss
- It might not be an apples to apples comparison - find out what's different
If it's not an apples to apples comparison, eliminate the pieces that your prospect doesn't value so that you can be more competitive. If you're service offering is more valuable, point out where it is.
If the competitor is buying the market and operating at a loss they will not be able to sustain that model forever. They won't be able to deliver high level service to their prospect consistently. They may not be committed to their market. Let your prospect know that. Let them know they are taking a risk by accepting a superficially low price and it may be more expensive for them with both time and money in the long run.
Time and money have equal weight in negotiations. However, time is more valuable. If you waste your time, you can never get it back.
If you have built trust and connection with your prospect you can ask them if it's OK for you to review the proposal or quote. Tell your prospect, honestly, if it's a deal you cannot compete with you'll let them know. Make sure you deliver on that promise.
Don't be afraid of your competition. Get to know them thoroughly. Understand what they do well and where they fall short. Work with your prospects to help them get the best deal possible. If your services fall short, bring them up. It's great market research.
Get out there and sell something . . .