If you don’t have a negotiation strategy before you start negotiating, you immediately put yourself in a position of losing — and losing big.
The 5 steps to a negotiation strategy that works:
1. Know exactly what it is the customer wants and/or needs.
If you don’t know what the customer is looking for, you have no reason to even think about negotiating. You simply can’t negotiate if you don’t know what it is you’re negotiating. If you do negotiate with somebody who doesn’t know exactly what they’re looking for, it’s like putting somebody in a buffet line — they’ll take whatever they want. Obviously, this could be detrimental to you.
2. Have a price point the customer has already rejected at least twice.
Negotiations need a baseline, otherwise there is nothing to which to anchor the process. This is why I say you sell first and negotiate second. Sell first and get your price on the table with the customer. Only after the customer has rejected your price twice should you even think about negotiating.
3. Have a list of things you are would be willing to offer up that are of low cost to you but high value to the customer.
Customers who are sharp negotiators will throw out requests of things they want. Be ready for them by having your list ready in advance. If you have to think on your feet, you will lose, especially in a tough negotiation. Think in advance of the low cost ways you can give.
4. Have a list of the things you absolutely must have and a list of things you would like to have.
As long as the customer might be throwing out things they might want, there’s no reason why you shouldn’t be doing the same. Again, if you don’t know these in advance, you won’t be ready to respond fast enough.
5. Be firm on your walk-away position.
Too many people wind up getting suckered one step at a time. Good negotiators know the point where they should simply walk away. Key to this is knowing it in advance. This prevents you from concluding a negotiation and then looking back at it, only to realize you didn’t get anything near what you expected.
Your negotiation strategy doesn’t have to be left to chance and it doesn’t have to be developed at the last minute. When you follow these five steps to develop a negotiation strategy, you will increase your odds of winning. More importantly, you will do it profitably — probably more profitably than you could have ever imagined.
Copyright 2012, Mark Hunter “The Sales Hunter.” Sales Motivation Blog.