For many salespeople and sales managers, one of the toughest parts of the job is negotiating the deal. The customer wants to buy from you, perhaps even needs to buy from you, but will negotiate hard to get the best deal they can. There is nothing wrong with that, but if you stumble now, it may affect your business for a long while. These five things are the do’s and dont’s of negotiation.
#1 – Negotiate only with those who can make a deal. Find out if the person you’re dealing with is qualified to actually sign the paperwork and make the deal when it’s done. If not, politely ask to negotiate with someone who is able to do that. By all means, use the unqualified negotiator to gain information, but in the end, your deal should only be struck with the person who can actually make the purchase. Otherwise, you’ll find yourself re-negotiating down the line.
#2 – Always be able to give something that will be a perceived benefit to “sweeten the deal” without lowering your price point. This could be just about anything, but warranties, customized delivery options, a direct line to an assigned customer service agent or salesperson for service requests, etc. are all possibilities here. Anything you might be able to offer that costs little and raises perceived value can be used as a negotiating chip to “sweeten the pot.”
#3 – Only put it in writing if you’re ready to set it in stone. Even emails, memos, etc. are all things that can, eventually, become bargaining chips or things brought up down the line. Shrewd negotiators will often get someone to commit a suggestion to writing and then pull it out at the end of the deal to push it as a part of the contract. Further, the information given may become a bargaining chip used to get your competitor to change something on their end. Information, once written (even in electronic form) is easily transferred. If you don’t want something spread around or used against you later, don’t write it down.
#4 – Use the rule of 3, but make it a rule of 6. This means you should know at least three things that your customer wants outside of the basic deal. Perhaps they could use something that complements the product being negotiated or something that adds value to the product for them or their own customers. Have three of these things you can use as per #2. Further, though, have three more things that can be used to counter the other person’s attempts to lower your price. Inevitably, negotiations will discuss price and your goal is to not change your price at all. Instead, change what is being given for that price.
#5 – Do not negotiate until the purchase process is underway. Never negotiate during your sales pitch or when courting a buyer. Let them try and flirt with the idea of negotiating, but don’t engage in it until the deal appears ready to be done. Often, this can mean that the sale will close without negotiation as the buyer sees perceived value and takes it. That is always the best scenario all around.