Latest / Closing the Deal with Fexingo: Sales, Negotiation, and Revenue Conversations for Operators / How a Rep Won by Negotiating Against Their Own Offer
Transcript
- Lucas: There's a piece of sales advice you hear all the time: never negotiate against yourself. Don't lower your price before the other side asks. Don't offer concessions unprompted. Luna: Right, because you're giving away leverage for free. But I've seen reps do it successfully. It's not always a mistake. Lucas: Exactly. And today I want to look at a deal where a rep did exactly that — negotiated against their own offer — and it worked. Not just worked, it closed a $340,000 annual contract that was stuck. Luna: Okay, you have my attention. Walk me through it. Lucas: So the rep is at a mid-market SaaS company — analytics platform, sells to operations teams. They've been in procurement for six weeks. The buyer's budget is firm at $300,000. The rep's list price is $380,000. They've already come down to $350,000. Luna: So a fifty-thousand-dollar gap. Classic impasse. Lucas: Classic. And the procurement director says, 'We can't go higher than $300,000. That's it.' Now most reps would either hold firm and risk losing it, or drop to $300,000 and give away everything. Luna: Or try to find some middle ground. But the rep did something different? Lucas: The rep came back with a new proposal. But instead of just lowering the price, they actually raised the scope. They said, 'Okay, we can do $300,000. But that price only includes the core platform — no onboarding, no dedicated support, no custom integrations. And the contract is annual only, no quarterly option.' Luna: So they made the offer worse on purpose. Lucas: Exactly. They negotiated against themselves, but in the wrong direction. They gave a concession on price, but they took away value. And that changed the entire dynamic. Luna: Because now the buyer has to compare something worse to something better, not just a lower number to a higher one. Lucas: And that comparison is exactly what the rep wanted. The buyer's internal champion came back and said, 'We can't go with the stripped-down version. We need onboarding. We need support. That's why we picked this vendor in the first place.' Luna: So procurement is suddenly fighting their own team. Lucas: Right. The champion essentially becomes the rep's ally. Within a week, procurement came back with $330,000. The rep accepted. Deal closed at $330,000 — which was actually higher than the $350,000 they'd initially offered, because the stripped-down version had lower delivery costs. Luna: Wait, so the rep's best price was $350,000, but they ended up at $330,000 with a higher margin? How does that work? Lucas: Because the $350,000 original offer included full onboarding and premium support — which cost the company maybe $40,000 to deliver. The $330,000 deal included a scaled-back onboarding and standard support — cost maybe $20,000. So the net margin on the $330,000 deal was actually better. Luna: So they didn't just win on price — they redesigned the package to be cheaper to deliver, then used that as a negotiation lever. Lucas: Exactly. And the key is that they didn't just drop price. They changed the scope. That's the critical distinction. When you negotiate against yourself by simply lowering your price, you signal that your initial price was inflated. You lose credibility. Luna: But when you lower price while also lowering value, you're reframing the trade-off. Procurement has to justify not just the discount, but the loss of features their own team wants. Lucas: And that's the real insight. Most reps think negotiation is about splitting the difference. But the best reps think about changing the variables. Price is just one variable. Terms, scope, timeline, support level, implementation complexity — all of those are levers. Luna: So the trick is to have a menu of trade-offs ready before you go into the negotiation. Lucas: Exactly. The rep in this case had already mapped out what a 'good deal' looked like at different price points. They knew which features were essential and which were nice to have. So when procurement said the magic number, they could immediately say, 'Here's what that buys you.' Luna: Which is the opposite of what most reps do. Most reps just say, 'Let me check with my manager,' and then come back with a lower number. Lucas: And then they wonder why they have no margin and no leverage. Let's talk about when this tactic backfires, though, because it's not always the right move. Luna: Yeah, I imagine if the buyer is purely price-driven and doesn't care about features, stripping things out might just make them walk. Lucas: That's exactly the risk. This works best when you have a champion inside the organization who genuinely values the full package. If the buyer is a pure commodity shopper, lowering scope might just confirm that they should go with a cheaper competitor. Luna: So you need to know your buyer's priorities before you try this move. Lucas: Absolutely. The rep in this case had done their homework. They knew the operations team was desperate for the onboarding and integration support. They knew procurement's mandate was purely cost. So they set up a conflict that they knew the operations team would win. Luna: It's almost like judo — using the buyer's own weight against them. Lucas: Perfect analogy. You don't push against their force; you redirect it. In this case, the force was procurement's demand for a lower price. The rep redirected it into a conversation about value trade-offs, which is a conversation they're much better equipped to win. Luna: One thing I love about this approach is that it forces the buyer to make a real choice, not just haggle over a number. Lucas: And that's the goal of any good negotiation — to get the other side to articulate what they actually value. Because once they tell you what they care about, you know exactly what to give and what to hold back. Luna: Okay, before we go further, I want to say something about today's episode. If this kind of concrete, tactical breakdown is useful to you — if it's helped you think differently about a deal you're working on — that's exactly why we do this show. Lucas: And the way we keep it ad-free and focused on real cases is listener support. If today was valuable, you can buy the team a coffee at buy me a coffee dot com slash fexingo. It genuinely helps us keep digging up these stories. Luna: Yeah. No pressure, but if this moves your work forward in some small way, that's the whole point. And your support lets us keep doing that. Lucas: Alright, back to the deal. So we've established that proposing a worse offer can be strategic. But there's a second layer to this that I think is even more subtle. Luna: I'm listening. Lucas: After the rep proposed the stripped-down version, procurement came back with a counter-offer of $310,000 for the full package. The rep didn't just accept. They said, 'I can do $330,000 for the full package, but I need a 24-month commitment instead of 12.' Luna: So they added another variable — contract length. Lucas: Exactly. And procurement agreed. So the final deal was $330,000 for two years, full package. That's $660,000 total contract value. The rep's original $350,000 for one year was $350,000 total. They increased the total deal size by almost 90 percent. Luna: Because they didn't just give a discount — they traded a discount for a longer commitment. That's brilliant. Lucas: And it only worked because they had a clear picture of what the buyer valued. The buyer valued the full package. The vendor valued long-term contracts. Both sides gave something up, both sides got something they wanted. Luna: That's the textbook definition of a win-win. But it required the rep to be willing to propose something that looked like a loss at first glance. Lucas: Right. And that's the hardest part for most reps. It takes confidence to say, 'Here's a worse offer.' Most reps are trained to always move toward the buyer. This is about occasionally moving away — to create contrast. Luna: So what's the one question a rep should ask themselves before trying this tactic? Lucas: I'd say: 'Do I know what the buyer values more than price?' If you can't answer that with specifics, don't try this. You'll just annoy them. Luna: And if you can answer it, then you have a menu of options ready to go. Lucas: Exactly. Map out three packages: the full-featured, the stripped-down, and the middle ground. Know what each one costs you to deliver. Then when the negotiation starts, you're not reacting — you're guiding. Luna: It's a much more proactive approach than just waiting for the buyer to tell you what they want. Lucas: And it's more respectful too. You're saying, 'I've thought about what you need, and here are real options that work for both of us.' That builds trust, not cynicism. Luna: Alright, so to wrap up: the takeaway isn't 'always negotiate against yourself.' It's 'sometimes negotiate against yourself deliberately, with a plan, and only when you know the buyer's priorities.' Lucas: Exactly. And the next time you're in a deal that's stuck on price, ask yourself: what can I take away that they'll want back? That might be the path forward. Luna: Good note to end on. Thanks, Lucas. Lucas: Thanks, Luna. See you next time.