How you handle that negotiation will determine whether or not you close the sale and how profitable that sale will be.

NEGOTIATE

  LIKE  A  GRANDMASTER

How many times have you the master salesman have heard from a cleaver purchasing agent:

"You've got to drop your price by 10% or we will have no choice but to go with your competition."

"You will have to make an exception to your policy if you want our business."

"I know that you have good quality and service, but so do your competitors. What we need to focus on here is your pricing."

"I agree that those special services you keep bringing up would be nice, but we simply don't have the funds to purchase them. Could you include them at no additional cost?"

Every time you hear statements like these, you're in the middle of a difficult sales campaign. How you handle that negotiation will determine whether or not you close the sale and how profitable that sale will be.

Every salesperson eventually must confront the following situation: You want the deal badly. You need the business. You've been suspecting that your price is too high to begin with. So what do you do? You lower your price rather than negotiate.

Many salespeople are afraid to stand by their price structure because of a single mistaken assumption: "If I refuse to negotiate my price, I'll lose all my customers." The reality is just the opposite. If you aren't prepared to defend your price, your customers will lose respect for you. Here are ten tips that will help you to negotiate the price you deserve.

In order to give you a real edge every time, I have listed below some key points taken from my sales training seminars @ the Bombay Chamber, Indian Merchants Chamber, etc in the last ten years....

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Don't Believe Everything You See and Hear

Part of a good salesperson's skill is to learn to read people and situations very quickly. However, when it gets down to negotiating, you have to take everything you see and hear with a grain of salt. Buyers are good negotiators, and thus they are good actors. You may be the only person who has what she needs, but everything she does and says, from body language to the words she uses, will be designed to lead you to believe that unless she gets an extra 10% off, she's going with the competition. Be skeptical. Be suspicious. Test, probe, and see what happens.

DEVELOP THE PYSCHE OF A NEGOTIATING-CHAMP

Finally, and most important, be patient. Sales is a high energy, fast moving business. Patience is one commodity that is in relatively short supply, but if you're impatient in a negotiation, you'll lose your shirt. If I'm negotiating with you and I know that you're impatient, I will hold out just a little longer, no matter how desperate I am to make a deal with you. As long as I know you're in a hurry, I'll wait.

¨      Do not underestimate your power. Most people tend to have more power than they think. Only by making a systematic analysis of power can you understand your strengths. Your base of power rests on a foundation of more than just competition or financial matters. Commitment, knowledge, risk taking, hard work, and bargaining skills are also real sources of power.

¨      Do not assume that the other party knows your weaknesses. Assume that they do not and test that assumption. You may be better off than you think.

¨      Don’t be intimidated by status. We are so accustomed to showing deference to titles and positions that we carry our attitudes to the negotiating table. It is well to remember that some experts are superficial; that some people with PhD’s quit learning years ago; some people in authority are incompetent; a specialist may be excellent in their field but without skill in other areas; learned people, despite high positions of power, sometimes lack the courage to pursue their convictions or have none. There is as much danger from having a “little-shot” complex as a “big-shot” complex.

¨      Don’t be intimidated by statistics, precedents, principles, or regulations. It’s 2010, some decisions are made on the basis or premises and principles long dead or irrelevant. Be skeptical. Challenge them.

¨      Do not forget that the other party is negotiating with you because they believe there is something to gain by being there. You may discover that this negotiation, no matter how small it is, is part of a larger framework in the other party’s objectives. This alone may provide you greater bargaining power than is apparent from the situation. Be positive in your approach. Assume that the other party wants agreement as much as you do. If they don’t, learn why.

¨      Don’t emphasize your own problems or the possible losses to yourself if deadlock occurs. In all likelihood, there are constraints on the other party’s action as severe as your own. Concentrate on their problems and issues. These are your opportunities to find routes to agreement.

¨      Most sales offers will require some concession making. Don’t set your initial demand near your final objective. There is sufficient evidence to conclude that it pays to start high. Don’t be shy about asking for everything you might want and more. Many times your demands may be too modest, or too easy to achieve. The other party may not know what they want or may have a set of values quite different from your own.

¨      It is a mistake to assume you know what the other party wants. It is far more prudent to assume you do not know, and then proceed to discover the realities of the situation by patient testing. If you proceed to negotiate a deal on the basis of your own untested estimates, you are making a serious mistake.

¨      Never accept the first offer—many people do. There are two good reasons not to: First, the other party probably is willing to make some additional concessions. Second, if you do accept the first offer, there is a chance the other party will have the feeling that their offer was foolish. They may find ways to spoil the agreement later. In either case, the negotiator who takes the first offer too fast makes a mistake.

¨      Never give a concession without obtaining one in return. Don’t give concessions away free or without serious discussion. A concession granted too easily does not contribute to the other party’s satisfaction nearly as much as one that they struggle to obtain.

¨      Get Something in Return for Your Added Value…What if you discover that the buyer wants to be able to track his expenditures for your products or services in a way that is far more detailed and complex than is standard for your industry? What if your account tracking system is set up in a way that you can provide that information at essentially no cost to you? Often the salesperson's overwhelming temptation is to jump in and say, "Oh, we can do that. That's no problem." Before you do, however, think about your options. You could throw it in as part of the package and try to build good will. Or you could take a deep breath and try something like, "That's a difficult problem that will require some effort on our part, but it's doable."

So be patient.Building the psyche of a negotiating champ takes time( even years)  Take the time that you need, don't rush to give in, don't show your anxiety, stay cool and don't panic. Negotiation is a process and a game. Use the process and play the game. You'll be astonished at the difference that it makes!

best of luck

dr wilfred monteiro