It's fascinating how the demeanor of a seller (rep or leader) changes when they get into a negotiation.
Sellers who were previously assertive and playing to win suddenly start playing not to lose, which causes them to say and do things, like voluntarily cut prices or margins, that aren't in their best interest.
To create negotiated outcomes that leave you and your prospect feeling like you both won go into all future negotiations with these three mindsets.
- I can't lose anything I don't have - until your prospect's money is in your account you don't have anything other than your prospect's word that you're getting their business. This is true when you are negotiating for additional business from an existing client
- I have Equal Business Stature with everyone at the negotiating table - elevate yourself about the traditional buyer/seller negotiating dance by communicating with your prospect as an equal. Shed the labels of "buyer" and "seller" and create a human-to-human interaction. That might sound like, "how do we both leave this table feeling like we've won?" If your prospect isn't open to being treated as or treating you as an equal then circle back to mindset number one and respectfully decline to participate in their negotiation.
- My prospect values the inch they had to fight for more than the foot I give them - in one of my first Sandler seminars the COO of a large industrial supply company and I role played "handling" objections. I said, "your price is too high" and without pausing the COO said, "where do we need to be?" Well, a lot lower than you might have had to be if you didn't say that.
Armed with those mindsets you can leverage these four steps to give concessions while creating win-win outcomes.
- Give concessions slowly - quickly moving to large concessions indicates that you're desperate and will prompt your prospect to push for concessions that are detrimental to you.
- Give concessions in small pieces - for two reasons. First, so you have something else to conceded if/when your prospect circles back for more and second because sometimes that small concession (e.g. 4 business day delivery instead of 5) may be enough for your prospect to move forward with you.
- Make it look like each concession hurts - your prospect feels like a winner while you give away the minimum required to close this deal.
- Get back something of equal or greater value - no free gifts in negotiations. One way to set this up is to say, "and if I..." as in "and if we agree to 4 business day delivery instead of 5 what would you do for us?" As with any interpersonal communication your tone will determine how your prospect will react to your question. Be aggressive and they will be aggressive. Be nurturing and they are likely to be open to continuing your conversation. You must also expect that their response will be, "I don't know. You tell me," to which you can name the concession you'd like from your prospect. If a prospect says "nothing" or "we'll give you our business," they aren't looking for a win-win relationship. Remember that both you and your prospect are still in the "dating" phase of your relationship when both are trying to impress. If they don't appear to want a win-win relationship now ask yourself what they might be like when you get "married."
Negotiating is still selling. Seek Equal Business Stature, win-win outcomes and maintain "walk away" posture with your prospect and your negotiations will be more successful.
Until next time... go sell something.
