Note: This is a guest blog from Michelle Laurey. The author’s views are entirely her own and may not reflect the views of Deepanshu Gahlaut’s Blog.
Whether negotiating in business is your primary role or you’re negotiating for higher pay, negotiating a deal can be a challenge. If you don’t have the right negotiating skills, you could lose enormous opportunities for a better situation.
Luckily, there are proven and effective ways to improve your negotiating. In this article, we will look at various methods to become a better negotiator so you can achieve more fulfilling, profitable, and fair outcomes for everyone involved.
Let’s get started.
Remember Your Competence and Power
Being confident and assured going into negotiations is essential. It helps you make more clear and focused decisions from a place of power rather than weakness. Negotiating can be intimidating, but remember that you have unique skills, insights, and values to bring to the table.
There is also an exercise you can do to boost endorphins and feel more powerful, according to a Harvard study. You stand tall and put your hands on your hips, thinking confident thoughts, and even smiling.
This will make your nervous system positively energized instead of fearful, which leads to the projection of power when negotiating.
Make Concessions Smartly
You want to make sure that you get as many benefits in the negotiation while giving the least amount away. Sometimes you will have to show some leniency too and adjust your offering within reasonable limits.
However, giving too much away too easily is a poor negotiating habit. Instead, you should always ask for a concession whenever the other party asks you to budge on something.
For instance, if they want you to include a free service in your product that you provide, make sure to ask them for something in return. Even if the concession they asked for is not a big deal for you, it is an opportunity to use the principle of reciprocity to get something in return for your side.
Don’t be afraid to lose the deal or the relationship with the other party, as there will always be some back and forth.
Have Second Options
Perhaps one of the greatest sources of leverage in any negotiation is having options. When you can walk away, you don’t need to fake your demands.
You have probably heard the advice of not putting all eggs in the same basket before. This is true both in business and in private matters. When you diversify your options, you can be prepared to pick up your things and walk out of the negotiating room if you don’t get the deal you want.
The best part is, you have another great deal or situation that you’ve already researched, so you aren’t actually losing anything.
Have a “Higher Authority”
It can be helpful to pretend that you can’t make a final decision without a third party or “higher authority,” even if you can. For instance, if someone is asking for your commitment to an offer, you can claim that you need to have the board of directors look it over first.
Sure, this is a white lie. But it buys you time to come up with a response that will benefit both you and your negotiating partner more in the long run — and that’s what really matters in any negotiation.
Be Aware of Time Constraints
Make sure that you are not painted into a corner when negotiating. If you have a hard deadline that you need to reach an agreement by, do not let the other party know.
Furthermore, try to find out their deadlines so that you can use these as leverage to get deals done that include more of your requests.
Sometimes stretching out a negotiation process wastes your valuable time and resources that you could be spending better elsewhere. You’ll need to evaluate on a case-to-case basis whether you can wait for an agreement or if there are better opportunities to chase.
Know All of The Facts
You’ve got to have all the facts to know what you can or can’t offer.
For example, before you go into negotiating a better deal with a supplier or customer, know what you have to lose.
Do you need supplies immediately, or you’ll have to stop operations? Is bargaining a small discount worth it if you’re meanwhile losing more money on missed business?
Alternatively, if a customer doesn’t know you have a warehouse full of certain products that are slow to sell, you can use that to your advantage and “let” them negotiate a good deal. The deal will make the customer happy, and you’ll finally move the stock out of your warehouse.
For small businesses that don’t have too many assets lying around or unlimited supplies, staying on top of your business operations and the assets you have and need is vital.
This helps you negotiate the right price that will be profitable and help you maintain proper inventory levels and operations.
Negotiate On More Than Price
When you think of negotiating, you probably think of price negotiations first. Most people think that negotiating just means going back and forth about money. However, there are actually many aspects to a negotiation that can boost value for your position or your company.
For example, you might be negotiating with a supplier, and they won’t budge on reducing their cost any further. In this case, you need to be creative and think outside the box.
Perhaps you can negotiate for faster delivery times, more access to live customer service agents, or other value-added services as part of the overall package. These types of wins will still translate to your bottom line without the other party feeling like they gave up more money.
Throughout any point in a negotiation, the other party might decide to alter their proposal. They can reduce, increase, modify, delete, add, or otherwise do something that can throw you off your game if you’re not prepared.
Go into every negotiation with an attitude of persistence. Understand that sometimes delays and changes will occur (and the other person might even do it intentionally to gain leverage). With patience and continued action, you can see the negotiation through to the end.
When it comes to business, negotiating is one of the most important skills to have. However, even though it is crucial to success in today’s world, it doesn’t come easily to everyone.
If you are new to negotiating or need a refresher, use the tips above to sharpen your approach. That way, you can have more successful outcomes in every aspect of your life and career.
Michelle Laurey works as a VA for small businesses. She loves talking business, and productivity, and share her experience with others. Outside her keyboard, she spends time with her Kindle library or binge-watching Billions. Her superpower? Vinyasa flow! Talk to her on Twitter.