Risk Reversal

“If you want a guarantee, buy a toaster.” — Clint Eastwood, Academy Award–winning actor

Key Ideas:

• Risk Reversal is a strategy that transfers some (or all) of the risk of a transaction from the buyer to the seller. The seller agrees to make things right in advance if the purchaser doesn’t end up satisfied.
• Risk Reversal is a great way to eliminate some Barriers to Purchase.
• This strategy may be feel uncomfortable to the seller as well, because no one wants to lose. The difference is that a seller can spread that risk among many customers. The customer can’t do the same.
• By eliminating the risk of purchase, you’ll close more sales and eventually make more money than what you’ll lose if some customers take advantage of your generosity.

Questions for Consideration:

• How can you convince your prospects that this is a zero-risk transaction?
• What risks can you transfer from the prospect to yourself?