We usually sell annual licenses to our product one at a time to small businesses in a specific medical niche. I've been asked to prepare a proposal for one of the largest suppliers in our industry, where they'll essentially be sponsoring purchase of our product for the end user, our mutual customers. Use of our product can help drive sales of their product through our mutual customers, which is why they're interested in this arrangement. They'd like an estimate for 500 licenses, and ballpark retail price is $5000/year. How do I approach volume discounting? $2.5M seems like a huge number to me!!!
👤 tarun_anand Accepted Answer ✓
Don't back down. You can give a volume discount but anything between 2-2.5 should be your target.
You have to service 500+1 large suppliers.
Give discounts for upfront purchase of licenses. Otherwise the sales rarely materialize.