Best practice negotiation

To negotiate effectively, it is important to focus on first principles, structure and the most common tactics employed by buyers. Most importantly, remember that negotiation is about a state of mind:

  • Have confidence in the value of your product: believe in and be fully committed to the power of your solution!
  • Give yourself options: the more hard work you put in to line up as many interested prospects as possible the better placed you will be to negotiate from a position of strength.
  • Be prepared: refer back to your notes. Consider what might be of particular value to this buyer from your past conversations. Imagine what his interests might be and work on them.
  • Imagine success: before any negotiation, take a few moments to imagine yourself closing the deal. Imagine how the conversation will proceed. See yourself responding firmly and professionally to a variety of gambits from the other side.

Get yourself in a positive frame of mind – it is amazing how much difference this can make.

Negotiate only once the value of the solution has been established – NEVER before

Only begin negotiating once the sale has been conditionally agreed. Don’t get drawn into negotiating until you have an agreement in principle. Remember - negotiating is not objection handling. Recognise the difference between

an objection Eg.

“There will not be enough primary market delegates at the event for it to be of benefit to us”

and a negotiating point

“We really will need to speak on the first day rather than the second”

Buyers will try to ask for concessions – usually on price – before agreeing that your solution has value. Don’t engage in this. Explain there is no point in looking at price or other concessions until you’ve established they are serious about the solution and that it has merit.

If you’re not sure the customer is committed to the sale, you can always ask:

“Are you saying that in theory you would like to go ahead once we pin down the details?”

Always aim high

Always aim for more than you think will get or are prepared to settle for. The less you know about the other party, the higher your opening position should be.

  • You might just get it
  • You may not know what their position is or just how much value they might put on the solution
  • It gives you negotiating room
  • It raises the perceived value of what you're offering.

And don’t say yes to any first offer the other side makes – it will make them think they should have asked for more and that there must be something wrong with the deal!

Get the customer’s wish list before negotiating

Get a complete list of what’s relevant and has value to the client. Ask what other issues and needs you need to be aware of. Negotiation is NOT just about discounting and price. There are many other elements to a deal that have value – both to you and the customer. Ask your buyer to list everything that is of interest and importance to them. Don’t discuss individual elements before you have this full list.

Always trade concessions – NEVER give them away

This is about discipline, control and confidence. Everything has a value. Always look for something in return from your buyer, no matter how small. People don’t value highly what they get for nothing. And they will not respect you for having given it to them. Every time we give away a concession and get nothing in return, we’re wasting an opportunity to protect our position, and our bottom line. Always be aware of concessions you can ask for in return for any additional piece of value you offer.

Examples of buyer concessions:

  • Commitment across more than one event
  • Access to marketing lists or data that would help boost delegate numbers at the event
  • Instant decisions to go ahead
  • Distribution of our brochures at their customer meetings
  • More active promotion of the event on their website and in their PR activity
  • Quicker signed paperwork
  • Higher level speaker from their organisation in response to a higher profile speaking slot
  • Testimonial from their organisation for public use in marketing materials
  • Referral to decision makers in other organisations

Focus on the overall package

An experienced negotiator will try to break down what you’re offering and attack each part. Of course there will be times when certain elements of a package will not suit a customer. But generally speaking you need to focus on the overall value of the solution to their business.

Never get caught up in the emotions!

Always stay focused on the issues at hand. No matter how much heat the buyer might try to inject into a negotiation, always remain focused on the facts of the situation.