I'm coaching a VP Sales and Founder through this. 

It's a never-ending debate but here's my two cents. 

Should we discount price or not?

1. This is a financial decision
2. This is a strategic decision
3. This is a personal preference

Those are the 3 topics that need to be assessed to decide if your company should discount or not (in that order). 

First make the smart financial decision.

Can you even afford to discount?

What are your margins? 

Next make the smart strategic decision.

What does your competitive landscape look like and how will you stand out?

Low price, high quality, or both?

Last is simply your personal preference.

Do you want to train salespeople on negotiation skills and entertain longer pricing discussions? 

The last point is a bit tricky because while discounting can mean longer price convos, it can also mean shorter price convos. This is why testing is important in the early days. 

That said, there's no easy or one-size-fits-all answer to this. 

For me, in consulting land, I don't discount because I want to focus our conversations on the value delivered and I want fairness across all clients. 

That said, I'm trading time for money, so margins and just about everything involved is different than SaaS.

While I think the easier decision is usually to have some sort of discounting model available to your salespeople, I will admit that I’ve always been jealous of companies who successfully don’t discount. There’s something so pure and simple about knowing all customers are paying the exact same price.

To do this, your pricing best be fair and accurate. 

Ask yourself these questions; 

1. What is your ARPA and average sales cycle length?

2. Can you achieve the same ARPA with shorter sales cycles by flattening price to the average and not discounting?

If yes, it’s probably smart to do so.

Happy Selling,