Negotiation is a huge subject. We’re going to narrow it down to negotiations within sales transaction context and summarize the content in bullet point form. So here we go:
Establish limits. Determine, in advance the extent of your flexibility, whether it’s price, giveaways, promises of delivery or SLA, etc.
Let the other party lead the conversation, usually who speaks first is at a disadvantage.
Don’t quote “Range”. Do not say you could do anywhere between 15-25%, always stick to one number, you may have to reduce or increase that number later on.
If price is the issue, structure the communication in such a way that they have to come up with their number first.
Make sure every point and adjustments are finalized 100% before you put anything in writing.
Make sure you are negotiating with the final decision maker, otherwise you may have to go into yet another session, starting with a big disadvantage.
Always seek win-win. If you had to give something away, ask for something in return.
Always try to steer the negotiation away from price, towards value. People pay for value, if they are constantly talking about the price you have not made an effective value presentation.
Keep the conversation friendly, after all, if the deal is signed you will be partners.
Know when to walk away. If the deal is not satisfactory for all parties, sooner or later there will be problems. I’ve seen many outsourcing deals go south because the deal was signed under unrealistic terms.
Offer your high-end package early in the conversation, if applicable. This would shift the customer’s thinking of price and value level.
Evaluate the importance of a concession for the customer, ask whether they are deal-breakers, or what alternatives there are.
If there seems to be a sticky point, try to break the issue into smaller parts.
See if multiple offers at the same time makes sense.
Incorporate the law of reciprocity.
Is there room for “long term perspective”?
Come up with questions that would make it easy for the customer to say yes. Try to score a few yeses early in the conversation.
Put yourself in the customer’s shoes.
Emulate the customer – adopt the customer’s tonality, speed and pace.
