How to respond when a buyer says "your competitor is cheaper"

That's useful to know, thanks. To make sure we're comparing the same thing, what's included in their quote? Things like [scope item] and [scope item] often differ.

Quotes from different vendors rarely cover exactly the same scope. Walking through what is included, calmly and without assuming the competitor cut corners, often explains the gap or shows it is smaller than it looks.

Fair enough. Leaving price aside for a moment, what would make one option clearly better than the other for you?

It brings out the buyer's other criteria, such as support, fit or risk, without you having to argue for them. If price really is the only thing that matters, you learn that too, and can decide honestly whether to compete on it.

Understood. The gap is about [difference] a year. Based on what we've talked about, is [the outcome they want] worth that difference to you, or not quite?

Turning the comparison into a single number, the difference, makes it easier to weigh against the outcome the buyer described. Ending with "or not quite" keeps the question honest rather than leading.

That makes sense. How are you planning to make the final call between the two? Is it mostly cost, or are there other things on the list?

Knowing the decision criteria tells you what you are really competing on. If cost is the only criterion, you can decide whether to compete on it. If there are others, you know where to focus, and so does the buyer.

That's fair, and if the cheaper option covers what you need, it may well be the right choice. Is there anything you'd want to compare before deciding, or have you got what you need?

Saying out loud that the cheaper option may be right is honest and disarming. Buyers who were using the quote as leverage often relax and tell you what they really think, and those who mean it remember that you did not push.