Unlock the Secrets of Effective Sales Negotiation: Stop ‘Buying the Sale’ and Boost Your Bottom Line!

Unlock the Secrets of Effective Sales Negotiation: Stop ‘Buying the Sale’ and Boost Your Bottom Line!


There are ongoing troublesome behaviours that continue to plague inexperienced and experienced negotiators

Based on our research and significant experience providing negotiation skills training, negotiating coaching, and consulting expertise to corporations, small business owners, and individuals, it’s apparent that there are ongoing troublesome behaviours that continue to plague inexperienced and experienced salespeople, sales managers, and businesspeople, in any industry, when it comes to negotiating.

I’m not convinced that the millions of dollars companies spend annually on so-called “sales training” adequately improves – or changes most salespeople’s and sales managers’ behaviours.  There is a proliferation of articles, blogs, LinkedIn posts, and numerous videos and webinars that attempt to help people follow a sales process and methodology, uncover customer needs and dominant buying motives, and try to instruct people on how to sell their company’s differentiated value proposition.

Based on the specific customer/account/client circumstances and market conditions, sellers at all levels of selling sophistication often focus too much on a price-based or concession-driven sale.  In most selling situations, salespeople don’t realize that they’re not negotiating correctly – or negotiating at all – and they’re simply “buying the sale.”

The Strategy for a Sales Negotiation

The real art of effective sales negotiating is to complete a satisfactory exchange without giving away more than necessary.

The challenge is identifying all the potential components for exchange and realizing how much value you and, more importantly, your customers/clients/accounts place on each component.  There can be many interdependent variables and moving parts involved in a negotiation.

Most salespeople spend far too much time making excuses or blaming these interdependent variables and moving parts for the less-than-desirable outcome they achieve.  Too often, organizations and salespeople fall victim to their flawed negotiating process and practices.  Their idea of negotiation usually involves an oversimplified barter process using an increasingly expensive package of financial and non-financial concessions that result in the salesperson “buying the sale.”

As the marketplace continues to be increasingly complex and competitive, salespeople (and sometimes their less-than-stellar sales managers) often don’t have the necessary negotiating skills.  Without the required skills, people often resort to the more common and easier-to-do “concession sale.”

The High Cost of Poor Sales Negotiation Skills

Picture this familiar scenario: A salesperson makes what they think are gratuitous concessions, believing they are closing in on an acceptable deal.  However, as they near the opportunity to close the sale, they realize that the other side sees all the concessions made as merely the starting point for a final negotiation.  The salesperson is then “trapped” into making additional concessions to get the business and close the deal, having already committed their company to everything they have “thrown in” along the way.

Not only has the actual transaction cost gone up, but the salesperson can’t be sure that their initial concessions were required in the first place.  One thing is clear: Reclaiming “spent” concessions given to customers is extremely difficult, and those concessions have become part of the ‘base package’ that the customer now expects to receive.

Because negotiating skills are not adequately refined on the selling side, some corporations are experiencing a gradual erosion of their profit margins.

On the buying side, sophisticated customers/clients are more successful at negotiating and increasing their profitability using their “situational power.”  Most sellers are unaware of “situational power” and how they can potentially counter its use.

This challenging dynamic has generated many vulnerable suppliers (sellers) prepared to give more significant concessions at each transaction to maintain their gross sales revenue or unit volume in the face of collapsing profit margins.

Effective Sales Negotiation Strategies and Tips

Here are some effective sales negotiation strategies and tips to help salespeople, sales management, and businesspeople avoid “buying the sale” when negotiating:

  • Learn and follow a disciplined negotiating process and methodology.  Companies and individuals must invest in negotiating skill development and make good negotiation skills and practices an organization-wide capability.
  • Planning and preparation are the most critical components of a negotiating process.  More often than not, salespeople and sales managers “cheat” and don’t do thorough or sufficient research before starting any sales negotiation.  You should always carefully and thoroughly plan and prepare for all sales negotiations  – even if the salesperson and company have existing business relationships with customers.  Why?  Because things are constantly evolving and changing – “You don’t know what you don’t know.”
  • Carefully determine, understand, and correctly diagnose the actual customer decision-making process and authority, wants, needs and dominant buying motive – before developing your price- or solution-based proposals or responses to an RFQ/RFP/RFI bid/tender process.
  • Companies and salespeople must develop and utilize compelling, effective, and persuasive price- and solution-based proposals and capability presentations. (Why buy from our company and me?) Salespeople make costly mistakes when they use the terms “quote or price quote” as part of their sales vocabulary.
  • Learn and understand effective customer value chain management.
  • Capture and record all your costs (e.g., couriers, product samples, technical support, etc.) that you’ve provided to customers during the year and claim value for these costs in the next negotiation.
  • Identify all the financial and non-financial concessions you are prepared to make and fully understand the cost of each potential concession.  Don’t assume there is “value” in a concession because there is cost.
  • Invest in the appropriate negotiation skills training and negotiating coaching and commit to adequately implementing and integrating the negotiating process, strategies, tactics, verbal phrases, scripts, questions, and questioning techniques.
  • Reinforce your negotiating training annually to stay one step ahead of your customers and competitors.

Remember: Nothing affects the bottom line of your company more – or your income more – than having effective sales negotiation strategies and skills.  You can’t make money faster than when you’re negotiating effectively!


Take Action and Invest in Our Expert Negotiating Training and Negotiation Coaching Packages, Negotiation Tools, and Online Course to Become a Better Negotiator.

» Negotiating Skills Training: Book a tailored in-house presentation, seminar or learning workshop for your organization.

Speaking Engagements – Industry Associations and Companies: Book a tailored, engaging, and impactful 60-minute to two-hour presentation at an upcoming meeting, conference or convention.

» Negotiating Coaching Packages: If your company is facing a challenging high-value negotiation and you need an expert to help you or your team – or you own a small business – or you’re an individual who needs practical negotiation advice, you can benefit from my investing in one of my three proven, results-producing negotiation coaching packages for individuals, small business owners or corporations.

» Digital Negotiation Learning Products: You can purchase my three E-books containing powerful strategies and tips.  E-books: Forensic Blueprinting Questions For Effectively Selling and Negotiating Price or Fee Increases and Managing the Price-driven Sale, Selling and Negotiating Price or Fee Increases in Any Economic Environment, and Strategies and Tips on How to Effectively Manage the RFP/RFQ/RFI or Bid/Tender Process to Optimize Results and Outcomes.

You can also purchase the Negotiating Personality Type and Corresponding Negotiating Style Self-Assessment Questionnaire and Interpretation Results and my NEW Digital MP3 “Greatest Hits” Verbal Negotiating Phrases, Scripts, Questions, and Questioning Techniques.  These helpful tools are in digital format and can be easily downloaded.

I provide a discounted Master Negotiator Bundle with all my Digital Learning Products.

» Online Sales Negotiation Course: If you’re in sales, sales management or a cross-functional role that supports sales, you can benefit from enrolling in my NEW self-paced Negotiating for Sales Success online course.

» Meet Negotiating Coach® Michael E. Sloopka

No part of this copyright material can be used without written permission from Selling Solutions Inc.

[/thrive_lead_lock]

The Art of Negotiating: Business, Social, and Personal Negotiations

The Art of Negotiating: Business, Social, and Personal Negotiations


The Impact of Negotiation in All Aspects of Life

Negotiation is a cornerstone of human interaction, impacting our personal lives and the commercial landscape.  Negotiating is an essential life skill that transcends boundaries, weaving through the fabric of our existence, from the boardroom, a meeting with a key account, to the family dinner table.

In this article, I’ll delve into the definition of negotiation in commercial, social, and personal contexts, unveiling the common threads that bind these seemingly distinct domains.

The Cambridge Dictionary defines negotiation as “the process of discussing something with someone to reach an agreement or the discussions themselves.”

Negotiation can also be explained as a strategic discussion intended to resolve an issue in a way both parties find acceptable. Negotiation can be a dialogue between two or more parties to resolve points of difference, gain an advantage for an individual or collective, or craft outcomes to satisfy various interests.

However, many “definitions” available in the public domain are unhelpful when we teach or coach our clients.  The terms “negotiation or negotiating” are overused, misunderstood or misinterpreted in the media, and most people rarely understand negotiating.

When I start our negotiating training seminars or negotiation workshops, I often ask participants how they define negotiating.  After a few minutes of me looking at blank stares in the audience – or receiving inaccurate responses, most people need help defining the term – it’s critical to describe what negotiating is – before we teach people our negotiating methodology, strategies, and tactics.

Our Definition of Negotiation/Negotiating:

We define commercial negotiations as the disciplined process to determine what is of value to the other side without giving away things that are of no value/importance to them that cost you – or your company money.

In a personal negotiation, we define negotiating as the means of moving an involved party to some degree in a desired direction.  Negotiating is defined as the essence of progress in a personal or social situation.

The Commercial Arena: Defining Negotiation

In the commercial/business world, negotiation is often seen as a structured process of reaching agreements, typically centred around tangible assets, services, or contractual terms.  It can be a high-stakes dance where parties strive to maximize their gains while minimizing concessions.

Commercial negotiations can occur between businesses, individuals and businesses, or within organizations.

Critical Elements of Commercial Negotiation:

  1. Objective-driven: In commercial negotiations, there are clear objectives – profit, market share, cost reduction, etc.  Success is often measured in quantifiable terms, making it imperative to create a well-defined strategy.
  2. Legal Framework: Commercial negotiations are guided by contracts and legal frameworks, ensuring that both sides fulfill their obligations and that there are repercussions for breaches.
  3. Expertise and Preparation: Due diligence, market analysis, and thorough preparation are vital. The sides involved in a negotiation come to the table with data, facts, and a deep understanding of their counterpart’s needs and constraints.
  4. Competitive Edge: Negotiations in business are typically competitive, where each side seeks to gain an advantage over the other.  This competitive spirit drives innovation and economic progress.

The Personal Sphere: A Different Angle on Negotiation

In contrast, personal negotiations are often less structured and revolve around relationships, emotions, and intangible needs.  Whether deciding on a vacation destination with your partner, significant other or spouse – or you’re trying to negotiate with children over chores on a Saturday morning – personal negotiations are integral to daily life.

Key Elements of Personal Negotiation:

  1. Relationship-Centric: Personal negotiations are rooted in relationships.  The aim is not just to reach an agreement; however, the goal is to maintain harmony and strengthen bonds.
  2. Emotional Quotient: Emotions play a significant role.  Empathy, understanding, and emotional intelligence are vital for navigating personal negotiations successfully.
  3. Informal Nature: Unlike commercial negotiations, personal negotiations often lack formal contracts and legal consequences. Trust and verbal agreements are the glue that holds personal negotiations together.
  4. Mutual Satisfaction: In personal negotiations, the goal is not just individual gain but mutual satisfaction.  Striking a balance between individual needs and the relationship’s needs is critical.

The Interplay: Where the Lines Blur

While commercial and personal negotiations may seem worlds apart, they’re not entirely distinct.  In reality, the negotiation skills, strategies, tactics, techniques, and principles from one sphere often prove useful in the other.

  • Communication: Effective communication is a common denominator.  Active listening, clearly expressing needs, and building rapport are valuable in both arenas.
  • Problem-Solving: Negotiation is fundamentally about solving problems and finding common ground.  Whether closing a business deal or resolving a family conflict, the art of reaching for compromise and creative problem-solving is essential.
  • Ethics and Integrity: Integrity and ethical behaviour are vital in commercial and personal negotiations.  Trust is fragile, and once broken, it’s challenging to rebuild.

Conclusion:

In conclusion, negotiation is a versatile art that transcends boundaries.  While commercial negotiations are often structured and objective-driven, personal negotiations are imbued with emotions and focused on relationships.  Yet, both spheres share commonalities in communication, problem-solving, and ethics.  Understanding these shared elements can enhance your skills in both domains, making you a more adept and empathetic negotiator.

So, whether you’re closing a multimillion-dollar deal or mediating a household dispute, remember that negotiation is about more than just reaching an agreement – it’s about forging connections and achieving mutual satisfaction.


Take Action and Invest in Our Expert Negotiating Training and Negotiation Coaching Packages, Negotiation Tools, and Online Course to Become a Better Negotiator.

» Negotiating Skills Training: Book a tailored in-house presentation, seminar or learning workshop for your organization.

Speaking Engagements – Industry Associations and Companies: Book a tailored, engaging, and impactful 60-minute to two-hour presentation at an upcoming meeting, conference or convention.

» Negotiating Coaching Packages: If your company is facing a challenging high-value negotiation and you need an expert to help you or your team – or you own a small business – or you’re an individual who needs practical negotiation advice, you can benefit from my investing in one of my three proven, results-producing negotiation coaching packages for individuals, small business owners or corporations.

» Digital Negotiation Learning Products: You can purchase my three E-books containing powerful strategies and tips.  E-books: Forensic Blueprinting Questions For Effectively Selling and Negotiating Price or Fee Increases and Managing the Price-driven Sale, Selling and Negotiating Price or Fee Increases in Any Economic Environment, and Strategies and Tips on How to Effectively Manage the RFP/RFQ/RFI or Bid/Tender Process to Optimize Results and Outcomes.

You can also purchase the Negotiating Personality Type and Corresponding Negotiating Style Self-Assessment Questionnaire and Interpretation Results and my NEW Digital MP3 “Greatest Hits” Verbal Negotiating Phrases, Scripts, Questions, and Questioning Techniques.  These helpful tools are in digital format and can be easily downloaded.

I provide a discounted Master Negotiator Bundle with all my Digital Learning Products.

» Online Sales Negotiation Course: If you’re in sales, sales management or a cross-functional role that supports sales, you can benefit from enrolling in my NEW self-paced Negotiating for Sales Success online course.

» Meet Negotiating Coach® Michael E. Sloopka

No part of this copyright material can be used without written permission from Selling Solutions Inc.

[/thrive_lead_lock]