Negotiating is something that every business owner and entrepreneur does on a regular basis. Whether it’s a deal with a vendor, a client, an investor or superstar employee you’re trying to hire, negotiating skills come in handy all the time.
Knowing how to negotiate well is an important part of building a business. It’s a skill that’s worth spending time to develop since making the right deals can make a huge difference over time. In fact, the deals you negotiate can spell the difference between success or failure for your entire business.
Ask for more than you expect to get
Negotiating the DealThis, of course, is fundamental to most negotiations and is something nearly everyone understands. Expert negotiators call this the key to success at the bargaining table. You might just get what you’re asking for, and the only way you can find out is to ask. It also prevents deadlocks when dealing with an egotistical negotiator who is determined to “win.”
Never say yes to their first offer
When you say yes to the first offer, you automatically trigger two reactions in the other person’s mind. The immediately think they could have done better or that something must be wrong because you’ve agreed to a proposal they didn’t think you’d accept.
Play reluctant buyer, even if you aren’t
When you are buying, you can shrink the seller’s negotiating range with three-steps. First: listen carefully to their proposal and ask all the questions you can think of. Second: tell them that you appreciate all the time that they have taken with you, but tell them it’s not exactly what you’re looking for. Third: At the last moment, call them back and say, “Just to be fair to you, what is the very lowest price you would take?”
Flinch a little at the other side’s proposals
Failing to flinch, or at least look disappointed, is the number one mistake that poor negotiators make. Always react with a degree of surprise that they would have the nerve to ask you for a concession – but in a nice and always professional way.
Use the vise technique
Listen carefully to the seller’s proposal and then say, “I’m sorry, you’ll have to do better than that.” Then be quiet! The next person to talk loses. The next person to open their mouth will likely make a concession.
Never offer to split the difference
Instead, try to get the other side to offer to split the difference. “How far apart on this are we? We’re not that far apart. There must be some middle ground on which we can both agree.” When they offer to split the difference, you can reluctantly agree to their proposal, which services their perception that they won.
When asked for a small concession, ask for something in return
Whenever you are asked for a small concession in the negotiation, ask for something in return. Say, “If we can do that for you, what can you do for us?” Often they will make a concession to you.
Retain your resort to higher authority
Don’t let the other side know that you can make a decision in the negotiation. Tell them that you have a higher authority that has to approve the final deal. “I can never sell this to my people at this price. You’ll have to give me a better price.”
Watch out for good guy/bad guy
Whenever you are negotiating with two people look out for them using this tactic on you. One of them appears to be mean, tough, and totally opposed to your proposal. The other is warm, friendly, and very sympathetic to your proposal.
Project that you’re prepared to walk away
The number one pressure point in negotiations is your ability to project that you are prepared to walk away if you can’t get what you want.
