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We are in a highly competitive market. There is a lot of negotiation that goes on while buying and selling lumber. Asking for a “Firm Offer” is a big part of it.
Asking for The Firm
There are a couple different ways to ask for a Firm Offer.
Us: “Julie, I’ve got a great deal on three truckloads of #2 2×6 14’s. We are always looking for 14’s, they are out of ABC sawmill, which is a mill you love, and the shipment is quick, which is also something we need as your inventory is getting low. Do you want all three?”
Julie: “I might. What’s the price?”
Us: “It’s a fantastic price at $723/MBF, which is a very good price in this market, especially on this quality. So, do you want to put them on?
Julie: “I like the stock and shipment, but I need a better price. Can you do any better?”
Us: “Give them to me firm at $705 and I’ll see what I can do.”
Julie: “You can have all three firm at $695.
Us: “Okay. Give me an hour and I’ll be back with something that will work.”
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Us: “John, I’ve got a great deal on three truckloads of #2 2×6 14’s. We are always looking for 14’s, they are out of ABC sawmill, which is a mill you love, and the shipment is quick, which is also something we need as your inventory is getting low. Do you want all three?”
John: “I might. What’s the price?”
Us: “It’s a fantastic price at $723/MBF which is a very good price in this market, especially on this quality. So, do you want to put them on?
John: “I’m going to shop these around a bit more and I’ll let you know.”
Us: “You could shop them and maybe save a couple bucks, but we could also lose coverage and end up paying more. Can we put them on right now?”
John: “I’m just not ready yet.”
We can try to overcome the objection a couple times—per the book two times is max or we start to move into “pushy” territory. After a couple of tries and the answer is still no we say the following:
Us: “Okay, John, will you do me a favor?”
John: “Sure, what is it?”
Us: “Will you talk to me before you buy them?”
We can ask for a Firm Offer, but I like the “Will you talk to me?” question better. I think it sounds stronger than asking for a Firm.
John: “Sure.”
Us: “Okay. It’s 3:00 your time. I will call you in 90 minutes and we will put these together.”
It is important that we set a firm appointment for the call back!
Just Give Me Your Best Number Up Front
There are buyers who do not like to negotiate. They say things like, “I don’t play that game, just give me your best number up front.”
I could be wrong, but I generally don’t believe this statement. The Pareto Principle (The 80/20 rule) states that 20% of the people have 80% of the money; 20% of the players on any team score 80% of the points; 20% of the carpet in any room gets 80% of the wear. I believe buyers are the same. They are buying 80% of what they buy from 20% of the people talking to them. Buyers are giving this 20% some kind of advantage.
We say, “Pete, there are two prices and there always have been. The ‘Quote Price’ and the ‘Buy Price.’ I am giving you the best Quote Price up front, but to get to the best Buy Price we have to work together. Can you give me a Firm on these trucks, so we can get the best Buy Price?
The other option is to quote a price we think we will be able to do with a Firm Offer and quote that. When the customer says they will take it, we tell them we have to check and see if the stock is still available and ask for a half hour to verify.
Getting Firm Offers is the gateway to getting orders. Do not hesitate to ask for a Firm Offer.
