People negotiate with each other for almost everything at almost every level. However, negotiation takes a much more serious role when it comes to business. If, as a businessman, you don’t have good negotiation skills, you are either losing customers or giving up a good chunk of your profits.
Unfortunately, negotiation doesn’t come naturally to all. Some are good at it, while others aren’t. Those who are not, kindly note the art of negotiation is not a talent but a skill you develop and hone over a period of time.
Let’s outline some effective negotiation tactics that anyone can use.
Do Your Preparation
Properly preparing for a negotiation means thoroughly reviewing and understanding the other party’s business. You could review the other party’s website, press releases, articles, etc.
Also, learn more about the person you will be negotiating with. Learn his/her background by reviewing their LinkedIn profile and doing a general web search. If the company has done deals similar to yours in the past, learn the details. If the client negotiates with multiple other businesses, know the other companies’ pricing and offerings.
Take Listening Seriously
Negotiating is not just about getting your point across or getting things done. It is also about letting the other party make their points and benefit from the outcome. To make this happen, you must know the other side’s requirements.
Always listen before you talk. While negotiating a business arrangement, price isn’t always the only focus. Better delivery schedules, bigger down payments, etc., are just matters of concern.
No Freebies, Please!
You send a customer a proposal, and he seeks a 15 percent discount. If you accept the offer immediately, you are not just making the customer happy but may also make him suspicious. Your immediate acceptance indirectly sends the message that your price was too high.
The best way to respond to such a discount request is to offer half or less of what the customer wants. You could counter-offer a 5 – 8 percent discount instead.
Alternatively, you can ask the customer something in return for the discount offered. For instance, you could ask for the delivery schedules to be relaxed, or they do pick up instead of delivery. Seeking a bigger deposit or down payment can be another alternative.
If you’re a buyer, you can be proactive by asking for a flat discount and offering an extended delivery schedule without the seller asking for it.
Don’t Act Desperate
Many times, even the best negotiations don’t yield the desired results. You should be prepared to accept that fact at all times. To be able to walk away from a negotiation, it is important to be practical about the business deal and not be emotionally invested in it.
The ability to let go when things aren’t going right also ensures you don’t get slapped with a raw deal. Also, be professional and courteous throughout the negotiation. You would not want to come across as someone who abuses or is difficult to work with.
Seeing and reaching the correct business deal means you know your numbers and the value of the product/service you’re negotiating. This means knowing the terms going in that are comfortable and agreeable.
The best ploy here is being practical and keenly listening to your intuitions.
Time is essential for any negotiation to evolve into a real contract. You should understand that the longer you take to complete a deal, the higher the risk for the deal to fall apart.
Therefore, always be prompt with your responses, turn the documents around quickly, and maintain the deal’s momentum. However, this doesn’t mean rushing through the negotiations and making concessions that you should not be making. At all times, do not underestimate time. It has the power to make or break anything.
Here’s to your success!