In B2B startup space, would you give away your product?

How is it "giving it away" when you're making a profit on the deal?

If its a big name I'd ask them to allow you to put their logo on your website and be done with it. Then you can use their name to close other deals.

This customer isn't going to respect you if you crumble when faced with a hardball negotiation style. A small number of customers will end up taking a disproportionate amount of time, and in my experience those customers who play hardball for no good reason are the most difficult (read: worst) customers to have.

Make them a reasonable offer and make it abundantly clear that if they're not serious they can get lost. It's not worth your time to chase customers who are just going to jerk you around.

Unless you need a referenceable customer, I don't see any benefit to caving on price.

I would, however, explore the reasons why said customer feels the need to chop down the costs. For a large company, $70K is literally a drop in the bucket - so unless there's some type of budget authority issue, I can't see why the $60K price cut is needed.

Agree with the other answers and would add a couple other thoughts:

Can you maybe drop a small amount and structure a payment plan as an incentive with either milestones or monthly's

Outside of the reference is their PR you can get from a drop in price, maybe even a co-sponsored vertical event

If you get them as a customer is this a vertical than you can gain some good momentum?

No!!! It is too hard to get money from a business and once you get those businesses in the habit of expecting free, they will never budget for anything more. They will go to your competitors after your trial ends. Charge something, even if it's low.

I'll preface my statement with a (hopefully) realistic assumption: that your company's service/solution is competitively priced in the market already, and that you can defend this position. How bad do you need this company as a client? Is $10K revenue / $3K profit, plus a name brand customer going to change the game drastically for you? Whether it will or not is not the point; you always want to come to the negotiation table from a POSITION OF STRENGTH.

If this company is throwing out lowball offers, then they are probably mis-guided, or don't take you seriously. If you take yourself seriously, and your product, then you will remember that this is simply a conversation between people. I'm not telling you what to do, but if you were to counter offer them, state your position and lay out all the things you need or want, other money. Better yet, create the scenarios yourself, and let THEM choose... option A, B, or C, which you pre-defined, and all of which are abundantly acceptable to you. I agree with the above commenter, stuff always goes longer and gets more expensive than you think. This is about give and take. You can't take unless you ask. BUT... you have to be willing to WALK. If you're not willing to walk, you're not a true position of strength. Go for a long walk around the neighborhood. Get into a strong state of mind. BAM!

Your post is really strange. You look like a virgin, not a CEO. If you were really a CEO you would say no.. Do you know any sales guy who says yes to a 85% discount ? Be serious. Respect yourself.

From sales tactic perspective, I'd toss it back to them and force them to defend their price.

Say, "interesting, out of curiosity, how did you arrive at that figure?" Then whatever they say, use market info or insider info to counter. And ask open questions that lead them to acknowledge the value you're bringing (which will be way higher than 10k).

Sometimes ppl use lowball figures bc

1) they have no idea what they're talking about

2) they want to test commitment / anchor price

3) they want a polite way to tell you to f-off

You need to read the situation. Remember, it's a back and forth (dance). Even if it's a no-go, use the opp to gather data / insights for future sales calls. Never, ever get defensive. (like some posts above)

At the end of the day, if you are solving a problem for them, they will pay for it.

As Liam Neeson likes to say... "good luck."

Where are your balls, (lady)man? Call his bluff! You have inside intel and know you have the best product, yet you're panicking? Ever heard of negotiation? Streets ain't for those who crumble like a pack of cards at first breeze.

Bottomline, you have other customers willing to pay the list price, so close them instead? Stop breathing in hype and start small, especially since you don't (yet?) have the liver to go big.

Agreed with the other posts - this weirdness is fishy:

This price <em>is</em> a drop in the bucket to someone that big
It's too low to be a negotiation tactic, a reasonable opening would be 50K, plus future consideration
You bring value, and you have other customers. Don't feel obligated to take every offer that comes your way. It's okay to turn down creeps.

Others have given enough answers, I'm interested and surprised to look at your loading/profit levels!! :)

I've seen, 20-30, even 50% loading, this is a whooping 90% loading!!

If you think cost is $7K, then cost is probably at least $10K. So many hidden costs are hard to calculate.

So no. Never take a chance of working for loss.

justify your product to him, you've already said it's the best available. Sell how it can improve his business, the cost savings it can produce, or the price in relation to the sub standard competition (if they are similarly priced) etc. You already know the inside line, don't devalue your work and product. And remember, desperate is not attractive!