Do You Need to Improve Your Negotiating Skills?
Is one of your New Year’s resolutions all about how to improve your negotiating skills? The entire concept of negotiating may seem like a sham to you. You might be asking yourself why the client just doesn’t agree to the posted price for your product or service so you can close the deal and move on.
The truth is that negotiating is a core part of business and of the sales process. If you don’t like negotiating, you’re not alone. In his Inc.com article, David Finkel reports that only two out of his 35 successful business coaching clients thought of themselves as good negotiators. The rest felt they needed improvement.
Before you allow your doubts about your abilities to cloud your mindset, remember that you’ve been negotiating your entire life. When you bargained with your parents to stay out late, you were negotiating. When a future employer made you an offer, and you returned with a counteroffer, that was also a negotiation. What’s different now is you are negotiating on the part of your employer and likely on behalf of your commission. So these negotiations matter. What you need is a plan to improve your negotiating skills.
How to Improve Your Negotiating Skills
When you feel butterflies in your stomach ahead of your next negotiation, force yourself to think logically. Follow Finkel’s advice and figure out what’s at stake. Write down the best possible and worst possible outcomes you expect from the negotiating session. Best case, maybe the prospect will sign a three-year deal with you. Or, maybe, despite your best efforts to answer all their questions up to this point, the prospect could decide to walk out of the negotiating session and take their business to your competitor. The end result of your session will likely fall in the middle of these two extremes. And to get there, you should know ahead of time how much you are willing to give up.
Because every prospect faces unique business challenges, your negotiating tactics should vary. If you’ve been listening to the prospect’s problems during discovery and during your subsequent meetings, you know their pain points. For example, your prospect may be particularly cost sensitive. It’s helpful to follow that thread to its origin. As Sean McPheat points out, cutting costs usually has to do with the desire to increase profitability. With that information, you’ll know how to proceed during negotiations.
Instead of negotiating on price, shift the discussion to value. While the prospect may have to pay for your product, in the long run, it will allow them to save money and increase profits. Remind them of the case studies you’ve given them on this topic. Hold the line on price and offer them additional training. In that way, they can use your product to their best and most profitable advantage.
Your negotiating sessions don’t have to be win-lose encounters. Approach these events with a win-win mindset. Do your best to get the prospect to agree to the deal that will deliver the best outcome for them.