When it Comes to Negotiating, Do You Know Their Value of Money?

 

There’s no sense in negotiating with someone who is not in the same ballpark as you.

This is my 6th tip in the 12.5 Negotiation Tips You Must Know.

We’ve already covered Sell First, Negotiate Second; Only Negotiate After They’ve Rejected Your Offer Twice; Make Sure You Are Dealing with the Decision Maker; Know Their Needs; and Know Their Timeline for Making a Decision.

It’s totally irrelevant if what you have is an absolutely amazing opportunity, but the customer sees the value as something significantly different.

The key is in realizing the customer will invest – and I use the word invest – because that is what customers do. They don’t buy; they invest. And they only invest if they see a return on their investment.

Customers will invest an amount of money equal to or less than the perceived value of what they expect to receive in return.

 

 

For example, a company will buy office furniture and invest an amount equal or less than what they expect to get in return.

They know if they don’t provide their employees with comfortable, pleasing furniture, it may impact their productivity or lead to increased turnover. Thus, the amount they will pay for the office furniture will be in relationship to how badly they want to maintain a good workforce and equip them to do their job.

The customer’s value of money in this example would be considerably less if the customer’s employees were never at their desks and they only performed low-level tasks. Conversely, the customer’s value of money would be extremely high if the employees were highly paid and spent their time structuring high value contracts.

The earlier in the process you can uncover the customer’s value of money, the sooner you will know if your value proposition has merit and is worth pursuing.

This is one of the few times where I say it is appropriate to walk away if you determine you and the customer have little chance of seeing equal value.

Not only do I say walk away, but also do not even think about negotiating with the other person. In fact, end the process before you reach the conclusion of your sales presentation.

Conducting a sales discussion that has zero potential to go anywhere is simply a waste of your most valuable asset – your time. 

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For more great information on Negotiation Success, check out Breakthrough Sales University!  You won’t regret making this investment in yourself.

Copyright 2015, Mark Hunter “The Sales Hunter.” Sales Motivation Blog. Mark Hunter is the author of High-Profit Selling: Win the Sale Without Compromising on Price.

Click on the below book cover for more info on boosting your profits!

High-Profit Selling

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