So I need to go over a topic that I rarely see anyone speak in depth about: Negotiating the Deal! There are some folks who briefly touch the topic, but I’d like to go a little further into it. Because if you cannot do it well or successfully, then you really aren’t going to have a great career in selling. Without pushing the customer away, the entire purpose of professional negotiations is to reach an agreement that benefits the salesperson and the customer in a win-win situation. It is NOT about you getting the upper hand. At the same time, it is NOT giving the customer everything they want just to make the sale. There must be some balance, or one of you will walk away from the table feeling salty and ripped off. And that always leads to bitter feelings and almost never a repeat sale. And if you have been in the sales business or business management for ANY length of time, then you know that repeat business is the goal. Repeat business is what will give you a great and successful career in sales.
These 10 suggestions, can help you exit negotiations as a winner:
#1: Start negotiations expecting to offer your highest price and conditions.
Always begin the negotiations with your highest price and conditions, as this is the place to start at. Then you can always come back a little, so that the customer feels that they got something from the deal. You really don’t want them to feel like you got the better end, as that will often lead to them getting another bid / offer. NEVER let it get that far, where they want to leave the table. This is a Lose / Lose!
#2: Don’t assume you have to match every customer concession.
The customer will always have their own demands, or what they want out of the deal. Expect it! Count on that and be prepared beforehand to give them much of what they want. If you can. Draw up a list of the things that you are willing to give them before the meeting. That way you can easily give them away if need be.
#3: Don’t give a concession without getting something in return.
So when you give a concession to the customer, always ask for something in return. Let them see that if you give them something, they must give something. This way, it really does become a give and take, and most importantly, it allows your customer to feel like your peer or equal. As well as feeling like they have power here, like you are both working TOGETHER. Because ultimately, they have the ultimate power. They can always get up and leave the meeting. Then you are done! Most salespeople will have this “superior” attitude. Like they are doing the customer a favor by just speaking with them. NOBODY responds positively to that.
#4: Make concessions in limited amounts.
Don’t give away the moon when giving concessions. Have a handful that you are willing to give up, and then stick to your guns. If you have too many, then you run the risk of appearing that your whole product is worthless. They may think “Jeez, if this guy has ALL this to give away, then what is he NOT telling me?” And again, if you get to this place, then you will be done! Because you have sown distrust, whether you wanted to or not.
#5: Don’t make your willingness to concede well known.
Some salespeople are like puppies. They are just so excited to be here and be alive in the room!!! And that is really a great place to be with a client. Just don’t go overboard and inadvertently give the impression that you will give anything away, just as long as they become your customer. Because the customer will smell that and go for your jugular. Their primary concern is the welfare of their business, not yours. If you give them the chance, then they will gladly take it. And then you are back to what I was saying earlier. There will be bitterness and feeling ripped off. Only this time, it will be you feeling this.
#6: Make sure the buyer understands how much your concession is worth.
When you give your customer a concession, make sure that they know how much that is worth to you and what you are giving up. That way, when you ask them for a concession, they will be more open to giving equally.
#7: Don’t jump at an offer of “Let’s split the difference.”
Sometimes this means that the customer has done a little more research than you, because this usually means that they come out a little better than you by “Splitting the Difference”. Be careful of this ploy, as it usually means something else.
#8: Handle the outrageous offer carefully.
This is a difficult challenge for you. You don’t want to come right out and ask “WTF? Are you insane?” And then at the same time, you don’t want to give up either. You have to come up with a response that will completely diffuse this situation as well as let them know that you are not to be trifled with. A simple technique that I have used is to just say this: “Gosh, I am really sorry, but there is absolutely no way I can give you that. My boss will NEVER approve that”. And then I will go on and ask the bomb. “Is this a deal breaker?” If they say yes, then you have to call their bluff. Then I will stand up and say “Thank you so much for your time”, and then prepare to leave. If they let you go, then they weren’t really serious about buying from you. But most times, they just want to see how far they can push you, how much they can get from you. And you must be willing to walk, you must be able to show them that they will not be able to take advantage of you. If it works out that they ask you to stay, then you will have won.
#9: Understand all the conditions before you start making concessions.
This is important that you know exactly what each concession means… how it will affect you and your bottom line. Make sure that it benefits you before you agree to it.
#10: Get a commitment to buy before you make a concession.
At some point, which is up to you, you need to ask this question: “Okay, great. We have agreed on this, and this and this. If I give you this final concession, will you authorize this agreement and we can move forward?” If they say they need to think about it some more, ask them why? Sincerely ask them why. Because if you have been negotiating for the last hour or two, and they are still hesitant to sign, then they are either playing with you, or they have a legitimate objection. But when the negotiation process if nearly done, you want to be able to walk out with the signed agreement in your hand.
In conclusion…You need to walk the razor’s edge of giving the customer enough to make them happy, and at the same time make enough money on the sale so your company can grow and you can go home and feed your wife and kids. Or your dog or cat… Well, you get the picture. Among the most important small business ideas that you can add to your arsenal, learning how to negotiate successfully will greatly enhance your career.