One of the most important skills you will learn in business is how to negotiate. I’ve met a lot of entrepreneurs and business owners who are scared to negotiate. They think that by providing resistance, they’ll ruin their chances of getting the contract or souring relationships. Nothing could be further from the truth! Negotiation isn’t about fighting or tricking other people, it’s simply a tool to communicate your needs. Here’s a little nugget: negotiators who think of it as a zero-sum game, or a win-lose situation usually don’t get what they want. Your goal in negotiation is to create a win-win situation. In today’s blog post, I’m going to show you exactly how you can do that!
Three Negotiation Tools to Get What You Want in Business
Understand the Other Side
In order to create a win-win situation, you have to understand what the other person or business you’re negotiating with really wants. It’s only when you find common ground that you can start the negotiation process.
For example, we were working with a vendor once who had a set price per unit of merchandise we were ordering. I knew the reason he had set that price was because he wanted to make sure he was making an even stream of income. Basically, he didn’t want to lose money on the deal. His prices were on the higher side for me, and once I understood what we both wanted from this deal, we began to negotiate. I told him I wanted the base price lowered but in turn, I could promise to order triple what his typical customers did, and on a regular basis. He didn’t lose money in the deal because I paid more than what he was making with his other clients, and he got a long-term client.
Timing is Everything
One of the most useful tools you have in negotiation is timing. Towards the end of the month, sales people are always trying to act fast and hit their goals/quotas. You have more of an opportunity here to negotiate because they’re more motivated to close the deal! Timing is important in real estate as well. The warmer months are typically hotter markets than the cooler months, so there are different ways to leverage that timing based on if you’re a buyer or a seller.
Timing can also work against you, though. The longer a deal takes, the more things that can go wrong. While you shouldn’t rush your deal, you should always respond in a prompt manner.
Be Willing to Walk Away
You shouldn’t start with an all or nothing approach, but you must always be prepared to walk away. Sometimes, no matter how hard one or both parties try, some deals just don’t work out. I say the same thing to my real estate clients. You can’t get emotionally attached to a deal or a property because you will end up over-paying big time. Be sure to exhaust all the options you have, but if you can’t come to a deal, it’s okay to walk away! You’ll find the deal that’s right for you.
What tools have you used to negotiate in the past? Comment below and let me know! For more reading on this topic, I found this book really helpful.