Posts Tagged ‘buyer’

« Older Entries
Newer Entries »

Can Sales Negotiation Be Done Via Email and Text?

Tuesday, May 26th, 2009
Email Is A Powerful Tool, But Is It The Right Tool For Sales Negotiations?

Email Is A Powerful Tool, But Is It The Right Tool For Sales Negotiations?

I might be setting off a bit of a firestorm with this idea, but here in the 21st Century do you think that it is possible to conduct sales negotiations using more smart phones and less human contact?

The Need For Modern Solutions

The #1 attraction of using a smart phone (Blackberry, iPhone, or whatever) in the first place is that it can speed just about anything up. The immediacy of e-communications allows deals to develop quicker and to move at speeds that once were unimaginable. However, when it comes to sales negotiations, things can get a bit trickier.

What we are all just starting to deal with here are the questions that come up surrounding e-mail negotiations. Some of these questions include:

  • Is it possible to conduct sales negotiations completely via email?
  • What impact does this have on what kinds of information can be shared during the sales negotiation?
  • When is human contact called for?

The New Rules

Using email as a central part of any sales negotiation changes a number of things. The first is that anything that you put into an email will live forever and may come back to haunt you. It is a great way to send information to the other side, keep almost perfect records, and make sure that everyone involved is informed on where things stand.

At the same time there are pitfalls that everyone must be aware of. These tend to show up whenever there are conflicts or misunderstands. The problems come about because the one thing that email does not do well is communicate emotions or nuances.

So what are the “new rules” in this world of email supported sales negotiations? Here are a few of them:

  1. Slow Down: do not write and send emails on the fly. Remember, these things live forever. I prefer to write the email one day, save it, re-read it the next day and then send it. I’m always careful to leave the “To:” field blank while I’m composing an email JUST IN CASE the “send” key get pressed too early.
  2. Only You Can Prevent Forest Fires: in order to prevent those cases where misunderstandings start small but keep getting blown out of proportion, don’t use ALL CAPITAL LETTERS, multiple !!!!!, or including flip comments (“How about making a real counteroffer?”).
  3. Don’t Forget The Phone: In every sales negotiation, there will probably be a time in which it would be better if you picked up the phone and talked with the other side instead of sending them another email. Realize that this moment exists, look for it, and act when it shows up.

Lessons Learned

The take-away from all of this is that times are changing. Gone are the days that all sales negotiations could take place face to face. Negotiating via email is here to stay and we all need to get used to the new rules of the game.

The experts who have been living with this new way of doing business have one final suggestion for all of us. They recommend that prior to starting the negotiating process, all parties meet in person. This is the key to allowing everyone to understand their body language and how they react to things. In the end, this is critical so that you can understand the true intent behind the words in their emails.

Do you negotiate via email today? Has there ever been a miscommunication caused by email? What caused the problem? How was it resolved? Leave me a comment and let me know what you are thinking.

Tags: , , , , , , , , , , , , , , , , , , , , , ,
Posted in communications | No Comments »

Tips From The Middle East For Sales Negotiators

Tuesday, May 5th, 2009
The People Of The Middle East Have Always Been Sales Negotiation Experts

The People Of The Middle East Have Always Been Sales Negotiation Experts

They say that the world is getting smaller every day. This may be true, but the people who live in this smaller world couldn’t be more different than they are! A case in point are the  sales negotiators who hail from the Middle East – Arabs if you will. Unlike us in the West who become uptight at the mere thought of entering into a negotiation, they actually look forward to negations – it’s fun!

There is a lot going on behind the scenes here. Not the least of which is that negotiating has been a key part of Arab culture since days in which the very first trade routes wound their way through the Middle East connecting Europe to the Orient. They’ve gotten to be quite good at this skill and it shows when you negotiate with them.

One thing that Westerners need to understand when entering into negotiations with Arabs is that bargaining is a very social activity for them. You’ll find that you will be greeted warmly and food and drink are often provided in generous quantities. This can throw a Western sales negotiator off because you’ll start to feel as though you are at a dinner party instead of a sales negotiation.

Arabs also have a different view of time than those from the West. In part because they enjoy the sales negotiation process nothing will be rushed. You’ll find that there are many breaks, many side discussions, and frequent interruptions.

These interruptions may include visits from people not involved in the sales negotiations. They may come and go multiple times. Just let it happen. You need to keep your calm and realize that you are playing the same sales negotiation game, just at a different table.

Finally, you need to realize that Arabs don’t really worry about deadlocks. They have no problems walking away from a sales negotiation and then coming back to it later on. They always hope to eventually do a deal, but they realize that sometimes this is not possible.

Have you ever had a chance to participate in a sales negotiation when the other side of the table was from the Middle East? Did they seem to enjoy the sales negotiation process? Was time a factor? Did you ever encounter a deadlock? Leave me a comment and let me know what you are thinking.

Tags: , , , , , , , , , , , , , , , , , , , , , , ,
Posted in how to negotiate | No Comments »

The Chinese Guide To Sales Negotiation

Tuesday, April 14th, 2009

Sales Negotiators Need To Learn How To Negotiate With The Chinese

Sales Negotiators Need To Learn How To Negotiate With The Chinese

Pity the poor American salesperson who goes out into the world of business and tries to negotiate. Sure, he/she is probably well equipped to negotiate with his / her American born-and-breed peers. I mean, after all, we share the same vocabulary, culture, and were brought up pretty much the same way. However, what happens when we encounter someone from a different (dare I say foreign?) culture? Like say, China…?

The world is constantly becoming a smaller and smaller place. Current economic conditions not withstanding, this is only going to speed up over time. That means that somehow we need to find a way to quickly come up to speed on how to deal with sales negotiators who come from different cultures. They think and act completely differently than we do and we are the ones who need to learn to adjust in order to make our sales negotiations successful.

Dr. Charles Karrass has spent a lot of time studying not only negotiations but also how cross-cultural negations do or don’t work. When it comes to dealing with folks from China, he’s got some suggestions for us:

  • Get Some Quanxi: Quanxi is the Chinese term for the construction of close family relations, or a joined network of relationships with the emphasis on the individual and informal groups rather than formal organizations. Building guanxi means building relationships. In sales negotiations, this means that by entering into a negotiated relationship, you are actually taking on a lot of responsibility. If things change during the contract, the other side can ask for changes and you are expected to be accommodating.
  • Watch Those Words: In negotiations with Chinese, what a word means is critically important. All too often, what a word means to you may not be what it means to the other side. Both before and during a negotiation, it would be worth your while to take the time to carefully define key words and make sure that both of you are using it the same way.
  • Persistence Pays: All too often in Western culture, we take a “no” as really meaning “no”. To a Chinese negotiator, your “no” just means “no for now” and they will feel free to revisit it over and over again to see if you’ve changed your mind. Many western negotiators have commented on this by saying that Chinese negotiators appear to grind away until they end up getting most of what they want. Chinese negotiators have both consistency and persistence – be prepared!

Yes, a sales negotiator can successfully conduct business with Chinese negotiators. However, you need to be aware that they view the world differently than you do and YOU are the one that is going to have to adjust in order to have these negotiations turn out successfully.

Have you ever had an opportunity to negotiate a business deal with a Chinese negotiator? Did they keep coming back over and over again to issues that you thought were already closed? Were there any misunderstandings over vocabulary words? Did you end up building a quanxi relationship? Leave me a comment and let me know what you are thinking.

Tags: , , , , , , , , , , , , , , , , , , ,
Posted in Chinese | 1 Comment »

Should Sales Negotiators Be In Long Term Relationships?

Tuesday, April 7th, 2009

Do Buyers Or Sellers Get More Out Of A Long-Term Relationship?

Do Buyers Or Sellers Get More Out Of A Long-Term Relationship?

Who wouldn’t want to be in a long term relationship? I mean we wanted our parents to be in one, we want to be in one, movies always end by having the hero walk off into the sunset and into a long term relationship, right? It turns out (as with so many things in life), when it comes to sales negotiations it depends on what side of the table that you’re sitting on as to if you should want to be in a long term relationship…

Let’s be straight here, getting ourselves into a long term relationship makes life sooo much easier. There are all sorts of benefits like reliability, friendship, and even peace of mind. However, it has been shown that over time these types of relationships start to favor one party over the other. Here’s what can happen:

  • You can lose your objectivity
  • You can become compliant
  • You can lose your company’s secrecy
  • You can become too dependent on the other side

If you are a seller, then getting into a long term relationship can be a very good thing. Generally speaking, long term relationships favor the seller over the buyer. Here’s why:

  • More often than not, product specifications change over time.
  • Changes in product specifications tend to increase the seller’s margin.
  • The seller can tailor standard offerings into special products and charge more for them.
  • The seller has fuller access to the buyer’s organization – the reverse is not true.

Sure seems like the seller has an unfair advantage doesn’t it? Buyers should take heart, there are actually a number of things that a buyer can do to even the score:

  • Change buyers every few years just to shake things up.
  • Expand the number of competitors vying to be your supplier.
  • Have another group evaluate each long term relationship every so often.

Long term relationships do have their advantages; however, just as with your love life, you need to step back every so often and make sure that this relationship is the right for you right now.

Are you currently in a (business) long term relationship? Are you the buyer or the seller? Do you think that this relationship is still a good one to be involved in? How can you double check this? Leave me a comment and let me know what you are thinking.

Tags: , , , , , , , , , ,
Posted in how to negotiate | 2 Comments »

Weird Negotiating: The Buy Now – Negotiate Later Tactic

Tuesday, January 27th, 2009
Buy Now - Negotiate Later Is A Dangerous Tactic That Should Be Used Carefully

Buy Now - Negotiate Later Is A Dangerous Tactic That Should Be Used Carefully

I’ve always thought that this tactic was just a little bit crazy, but I have come to think that it goes on a lot more than any of us may believe. To set the stage properly, you’ve got to be able to imagine a buyer who is desperate. For whatever reason, a project has got to be started NOW. Ultimately the project has a number of items that are going to have to be negotiated, but its got to start NOW.

Using the buy now – negotiate later tactic, the buyer asks the seller to start the project now on a prearranged contractual basis. The buyer will then provide some limited funds in order get things started and both the buyer and the seller agree to work out the details in the future.

Does this sound dangerous to you? This is not the way that I like to work – things can get messy really quickly. The key reason for the way that I feel is that it can be incredibly hard for a buyer to change vendors once the project is started. We all tend to make both financial as well as mental commitments that are hard to change after we’ve reached an initial agreement with the seller. What was once a temporary agreement, has somehow become permanent and the buyer is locked in to it.

With all of this having been said, buy now – negotiate later can still be the way for a buyer to go in certain special circumstances. Some of these are:

  • Blobs: Sometimes the amount of work that has to be done truly can’t be estimated until some initial work has been done.
  • Out Of Time: Although we’d all like to have plenty of time to sit down and complete a negotiation, sometimes there is no time for negotiation – work needs to begin right NOW!
  • Phantom Costs: Sometimes there has been an initial discussion of prices between both parties. This has left the buyer feeling as though the seller is trying to collect for expenses that will probably never occur.
  • Pilot Time: If the buyer has never dealt with the seller before or if the job requires unique specialized skills, then the buyer may want to try-it-before-he-buys-it. This will provide the buyer with a way to find out if the seller truly knows his stuff.
  • Seller’s Advantage: The seller may be willing to enter into this type of deal if he/she realizes that his bargaining power is going to be less later on. There are several different reasons why this can happen, the most common is that resources have been committed and this means that he/she will lose this contract opportunity.
  • Good Record: The buyer may be willing to enter into this type of agreement if his research shows that the seller has a good track record and past customers report that he probably won’t rip the buyer off.
  • Not To Exceed: The buyer can consider entering into this type of deal if the seller is willing to commit to a not-to-exceed price at the outset.

I’m still wary of these types of deals. Even sellers need to be careful. A seller’s power in a negotiation is the greatest during negotiations BEFORE work has started. Once services start to be delivered, then all bets are off.

Have you ever been part of a buy now – pay later deal? Why was this type of deal proposed? Who proposed it: the buyer or the seller? How did it turn out – was everyone happy in the end? Leave me a comment and let me know what you are thinking.

Tags: , , , , , , , , , , , , , , ,
Posted in tactic | No Comments »

« Older Entries
Newer Entries »