Negotiating is an important skill. In life, we might think of negotiating as “compromising.” In business, negotiating is about closing deals. If you run a business, chances are that you handle negotiations on a regular basis. Whether for making sales, forming partnerships, finding suppliers, or any other reason, negotiating is a part of business. Today, we will cover 4 secrets for successful negotiating.
The first thing to remember is that negotiating is about finding a win-win solution. If both sides approach the discussion with an intent for mutual benefit, it is much more likely that you will come to an agreement. If one side approaches the negotiation intending to take everything and concede nothing, the negotiation is set up for failure. This is the most basic principle of successful negotiating.
Negotiating is about finding a win-win solution. #business #smb #smallbiz #smallbusiness Share on XIn order to find the win-win solution, there are several tactics you can employ. The more of these you can do, the more prepared you will be and the more you can maintain a constructive conversation.
- Know what the other side wants. To create cooperation in a negotiation, show that you know what the other side wants. You will be hit with fewer surprises if you do a little research on this or – if nothing else – try to think like the other party. What are they motivated by? What do they need? What do they want? What are their deal breakers? It eases the conversation if you are able to lead by acknowledging what you know about their needs so they understand you are prepared to find a way to meet somewhere in the middle. And if you do not have a means of researching this, go ahead and ask. It will show that you care to know what their priorities are.
- Figure out who has the power. Which side of this negotiation is holding the power? Is one side more desperate and the other has more options? Is there scarcity involved or does one of you have a tight deadline? Does one side need to cut price? If you are in a position of power in the negotiating process, you have more control over the rules of the negotiation, which could be everything from the scheduling to the process itself – and perhaps even more control over the outcome. If you are in a weaker position, you might find that you have to deal with more inconveniences or make more sacrifices in the overall arrangement. It makes a difference if you understand this dynamic up front and lean into it. Otherwise, you might be setting the stage to butt heads later.
- Know what you are willing to give up. Prioritize what you are negotiating for so you know what is most important to you. You can look at this a number of different ways. You can have a three-tiered approach of “NEED to have, WANT to have, NICE to have.” In this case, the needs are your deal breakers, the wants are things that would make a material difference for you, and the nice to haves are perks. Or you could break this down into two tiers of needs and wants. By doing this, you are prioritizing what you are negotiating for. This is an internal list you are creating, not something you want to show to the other party. You might start the negotiation by mentioning everything on your list, but you know you want the end result of having all of your needs and some of your wants. So, once you get deeper into the negotiation, you can see very simply that nice-to-have or some want-to-have items can be sacrificed for the greater good, as a show of faith in the compromise. Surely you don’t have to hold onto every single thing. Creating these tiers for yourself can be a handy way to know what to let go of when the time comes.
- Show how you are benefiting them. As you go through the process of negotiating, it doesn’t hurt to remind the other party of what they are getting. It can be especially meaningful to sum it up by presenting their list of needs back to them and showing that you have met those needs through your agreement. Listing them back shows that you met all their requirements and is a great lead-in to closing a deal or signing a contract. This is a particularly useful tactic if you find the other party keeps adding to the list as you think you are close to sealing the deal. In that case, this is a way to assertively point out what they brought up to begin with and show that you have addressed the list so you can drive towards a conclusion.
There are many nuances to negotiating, and it takes practice to become skilled in this area. By having a win-win mindset and using some of these tactics to help you generate forward momentum, you can begin building strong relationships and start getting what you want!