10 Tips for Successful Business Negotiations – businessnewsdaily.com

• When you’re negotiating, never make assumptions and don’t rush.
• Don’t take negotiation personally; it’s just business.
• Don’t over-negotiate or accept a bad deal to make a sale.
• This article is for professionals looking to boost their negotiation skills and become better salespeople.

Whether you’re negotiating your salary at a new job, asking for a pay raise or overseeing a business deal, negotiation is a skill every professional will need – but it’s no easy feat. It can take a long time to reach an agreement no matter what you’re negotiating; and ultimately, you might not even get the outcome you desire. That’s why it’s important to ensure you bargain the right way. Even the smallest mistakes can cost you a successful deal.

Here’s more on why negotiating skills are essential, along with some concrete tips on successfully closing the deal.

Tip

If you’re a businesswoman, learn some salary negotiation tips for women to help close the wage gap.

The importance of negotiating skills

Negotiating is a skill that goes hand in hand with the skills you need to become a better salesperson. You may be tasked with negotiating real estate transactions, conflict resolutions, sales and purchases of merchandise, and salary discussions. And it’s not all about money; negotiating is also a valuable skill in your personal life. Negotiation skills are life skills, and if you don’t develop these abilities, you’ll see a direct impact on both your business and personal life.

Did You Know?

Negotiations are likely to end in a higher-priced agreement when the seller initiates terms.

What not to do when negotiating

We’ll start by going over some negotiating don’ts, courtesy of Molly Fletcher, consultant and author of A Winner’s Guide to Negotiating: How Conversation Gets Deals Done (McGraw-Hill, 2014). Here are some negotiation blunders to avoid:

1. Don’t make assumptions.

The key to a successful negotiation is being prepared, which means a lot more than knowing numbers and facts.

“Failing to prepare is preparing to fail,” Fletcher said. “Preparation means gathering and understanding the hard data – for example, your comparables – but it also means having 360-degree awareness.”

This means you need to know the decision-maker and the other party’s needs, values, hopes and fears. Fletcher explains this means not assuming that anything is nonnegotiable beforehand.

“Gather as much data as you can in advance, and be prepared to ask strong diagnostic questions to gain clarity,” she added. “There is rarely a clear roadmap within a negotiation.”

The more prepared you are, the better you’ll be able to navigate the negotiation.

2. Don’t rush.

Negotiations take time, especially if you want them to go smoothly. Take the time to establish a real relationship with the other party, Fletcher advised.

“Share a little piece of personal information that signals your openness and desire for connection,” she said. “Doing so can shift a negotiation from an adversarial battle to a productive conversation.”

Don’t be afraid to build in pauses, as they can help everyone regain perspective and remove undue emotions, Fletcher recommended.

“A negotiation doesn’t have to happen all at once,” she said.

3. Don’t take anything personally.

Fletcher recognizes that it can be easy to let your emotions get the better of you during a negotiation, especially if it affects you personally. But getting too emotional will hurt your productivity, she cautioned.

Her advice for making it through unscathed? “Challenge yourself to turn moments where you feel attacked and defensive into moments of curiosity where you can gain feedback. Emotion can easily be used against you in a negotiation.”

Fletcher also advised being aware of your emotional triggers, and knowing how to pull back when you feel things shifting in the wrong direction.

4. Don’t accept a bad deal.

Fletcher conceded that negotiation can be a long, tiring and stressful process. It can be easy to settle, but agreeing to a deal just to get a deal isn’t good, no matter what side you’re on.

“It’s important to remember that a deal isn’t necessarily better than no deal,” she said. “That can be discouraging when you’ve invested time and energy into getting a deal done, but it’s important to have that clarity.”

Fletcher advised that you understand, going into the negotiation, precisely what you’re willing to give up – and what you aren’t. “Ask yourself, ‘What does success look like? At what point am I comfortable walking away?’”

Ultimately, walking away from a deal should always be an option.

5. Don’t over-negotiate.

If you’re lucky enough to have the upper hand during the negotiation, don’t take advantage of it too much, Fletcher cautioned. Consider the consequences of over-negotiating: You might get what you want, but at what price?

“Don’t put yourself in a position where you can’t go back to a relationship because you overleveraged,” Fletcher said. “Recognize that hopefully, this is a relationship and a conversation that will continue over time.”

Key Takeaway

Almost half of the employees in the U.S. don’t feel confident in their negotiation skills.

What to do when negotiating

Along with negotiating don’ts, here are some proactive tips for negotiating:

6. Be the first to make an offer.

Part of being a good negotiator is taking control of the deal. Making the first offer creates a standard for the contract, especially if you’re the seller.

7. Provide set terms instead of price ranges.

Providing a price range only gives the buyer the upper hand. Buyers will focus on the low end of the price range and get the agreement locked at that rate.

8. Use words wisely while negotiating.

You don’t have to talk about the entire negotiation. Say what you need to say and combine that with direct contact. This direct approach establishes confidence, making the other party more likely to accept your proposed terms.

9. Ask open-ended questions and be a good listener.

Yes-or-no questions aren’t as effective and don’t produce details and context. Ask questions that help the other party understand how they benefit from the negotiation, and make sure they understand the overall agreement. Listen to their concerns and objections, and counter them with answers that prevent doubt.

10. Offer a win-win scenario.

Any negotiation ending with one side benefitting from the agreement will lead to a faulty business relationship. One-sided negotiations decrease trust and rapport. Both you and the other party should feel assured that you’re getting a fair deal.

Tip

There are particular concerns when you’re negotiating for a business loan. It’s essential to approach the right banks, know your terminology, limit personal guarantees, and always be prepared.

Negotiation nuances to understand

There’s no such thing as a foolproof negotiation method; however, some tactics are more productive than others. Here are some examples of negotiation nuances you should understand:

Close the deal while adding value.

When you’re closing the deal, try to add value to the contract rather than selling yourself short. For instance, if you’re selling cable packages, you may be happy just to get someone to agree to subscribe to the service.

Consequently, a seasoned negotiator will go the extra mile by offering premium channels and upgraded equipment. Moreover, these add-ons will be better received if you throw in a discount that makes the customer feel like they’re getting more for their money.

Never denigrate the product or service.

If you include too many negatives in your negotiations, you’ll scare customers away. For example, if you’re selling cable packages and a customer comments that the price is higher than expected, the worst thing you can do is agree with them.

If a customer gives you their undivided attention, they likely want you to convince them to buy your service and products. However, by agreeing that the package costs too much, you’re simply affirming that the service isn’t worth the money.

Instead, counter this argument by acknowledging their concerns and providing more context. Try: “It may seem like a lot, but with all the channels you’re getting, we are losing money,” or “Yes, some customers say that, but we do provide a bulk discount that makes it much more affordable than it seems.” Staying respectful of both the customer’s concerns and your product or service will present you in a much better light – ultimately boosting the customer’s confidence.

Brittney Helmrich contributed to the writing and reporting in this article. Source interviews were conducted for a previous version of this article.