Discounts: when to give one, and for what
28 Aug 2026 PricingMargin
"Give us a discount and we sign today." The sentence that ends two weeks of negotiation in a minute, and costs more than you think.
What an unconditional discount does
- It says the first price was not real. Someone who misled once is expected to mislead at renewal.
- It becomes next year's ceiling. 15% today means renewal starts at 85%.
- It gets repeated. Buyers in the same sector talk, and your price becomes public knowledge.
The rule: no discount without an exchange
Every concession on price is matched by one from them. Four acceptable trades:
| What you give | What you take |
|---|---|
| 5% | Annual payment upfront instead of monthly |
| 7% | A two-year term instead of one |
| 5% | A published case study or two referrals |
| 10% | A smaller scope, fewer features or seats |
Note the last: reducing scope is not a discount, it is a different price for a different product. It is the cleanest answer when the budget is genuinely smaller than your ask.
Before you give, ask two questions
- "If we agree on price, do we sign this week?", if the answer is "we need to go back to management", price is not the obstacle and a discount moves nothing.
- "What number makes this pass on your side?", reveals whether it is a budget problem or routine bargaining.
Protect it with the system, not with policy
Policy is forgotten under end-of-month pressure. Make any discount above a threshold require approval, not a reminder. And log a reason from a list with every discount, so after a quarter you know: do we discount for competition, or for weak qualification?
Price is not your top reason for losing
Price is not the top reason you lose. Review your loss reasons: if "no decision" outweighs "price", discounting treats a symptom, not the disease — and your problem is qualification.