I thought that it might be useful this month to share some outputs from a Negotiation Skills workshop delivered recently. The objectives were twofold; firstly how to resist pressure from clients demanding discounts and secondly how to maximise deals when buying on behalf of your company. Top line is that strategies have changed recently and will continue to be affected by the remnants of the recession. Whilst financial controllers may be losing their grip in the boardrooms, buyers have developed a habit of asking for discounts and the better ones demanding extra value for their budgetary spend. That is critical because in many instances we know that once we progress the sale to the point where money is discussed, it’s time for them to start to negotiate.
There are a number of tips that may help you defend against this and hopefully protect your margins. The key is preparation – identify your highest and lowest limits and aim high and expect the best. Put yourself in their shoes – what type of person are they and what would they consider to be a satisfactory deal? Plan your initial stance carefully and set the ‘atmosphere’ you aim to generate maybe by indicating how few stands are left or how popular speaking slots are. Get them to reveal their shopping list before you reveal yours and extract all the points they want to negotiate before you negotiate any of them. As a rule of thumb, never give a concession, trade them, (reluctantly, preferably at a profit) and justify each one. Remember generosity is not contagious – it is often seen as a weakness to be exploited. Keep the whole package in mind all the time and keep searching for variables. Examine the concessions you usually make in your business and be sure you have stressed the worth of each – there is no point granting, say, a hyperlink to your web site if they fail to see the true value and worth of this variable. Learn how to defend yourself by raising the value of what you offer and reduce the worth of their concessions in return. Also be sure to make them work hard for any concessions – people place a greater value on things they have had to struggle to get so be stingy and play hard to get.
Think carefully about deadlines – he or she who has time on their side has a powerful ally. Make offers conditional upon early commitment or payment terms. Do remember that it is not personal – you are employed to do the best deal you can for your company – so are they for theirs.
The mantra is Love the person – Hate the deal! Let them feel that they have done the better deal despite the fact that you are a good negotiator. It is also a useful strategy to summarise clearly and often – his reminds them of progress, value and worth. It also is a proven strategy to avoid confusion and avoids the moving goalpost syndrome! Finally do make sure you keep the door open completely, even if negotiations appear to have failed. Time is a wonderful thing and situations do change in some cases as quickly as overnight. So long as they can save face and re-approach you (or the other way round) there is always the possibility of future business or additional revenue coming in.