Posts Tagged ‘negotiator’

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Power Loss In Sales Negotiations

Tuesday, September 1st, 2009
Negotiators Have Both Positive And Negative Sources Of Power <p> (C) - 2008 </p>

Negotiators Have Both Positive And Negative Sources Of Power (C) - 2008

The single  most important factor in determining how a negotiation is going to turn out centers on a single question: who has the most power? The big problem that most of us have is that we don’t think that we have enough of it. Turns out, we’re generally wrong about this…

The Secret Of Negotiating Power

What is power in a sales negotiation? Simple – it’s the ability of one side of the table to control both the resources that are available to the other side as well as the benefits that they can get.

At all times during a sales negotiation it is your responsibility to be looking for ways to build up your power base while at the same time working to prevent the other side of the table from gaining leverage over you (and thereby causing you power loss).

Where Does Your Power Come From?

All too often when I’m talking with sales negotiators, they’ll tell me that they don’t feel as though they have enough negotiating power to be successful in an upcoming bargaining session. When we talk a bit more, it quickly becomes apparent that they are only seeing half the story. Specifically, they are only thinking about “positive power“.

Positive negotiating power comes from all of the things that put you in a good position to negotiate. Having plenty of time to make a deal, having attractive alternatives, having plenty of funding, etc. – these are all sources of positive power for you.

What my clients always seem to overlook is that they also have “negative power” working for them. Negative negotiating power comes from limitations and restrictions that the other side of the table is working under. These can include the need to reach a deal quickly, not having a good alternative to dealing with you, or even limited availability of funds.

Final Thoughts

The power that you have during a sales negotiation isn’t something that sits on the table next to you. Instead, it’s more like a feeling of confidence that you have when you sit down at the table.

Not only do you have the easily recognizable sources of positive power working for you, you also have the hidden sources of negative power on your side also. If you can learn to spot both of these power sources before you enter into your next negotiation, then you will be able to close better deals and close them quicker.

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

What We’ll Be Talking About Next Time

All sales negotiations are driven by both public and private needs. If you can understand and deal with the other side’s hidden needs, then you’ll have more power during the negotiation.

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Posted in power | 1 Comment »

Winning Sales Negotiations: The Pizza Secret

Tuesday, August 25th, 2009
Secrets To Making The Biggest Deal Pizza! <p> (c) - 2008 </p>

Secrets To Making The Biggest Deal Pizza! (c) - 2008

Recently I was talking with some friends of mine who are planning on using the current depressed real estate market to “trade up” and get a bigger / better house. They were lamenting the fact that this process was going to require them to negotiate with the sellers. They had come to me because they knew that I teach others how to use negotiation to quickly close bigger deals.

What they wanted to do was use that “win-win” technique that they had heard others talking about and they wanted me to teach them how. Sigh. Nothing in life is ever as easy as it seems, but from this experience I thought there were a few key points that you might be interested in…

The Negotiating Pizza

When I started talking with my friends about the house that they wanted to buy, I kicked off the conversation by asking them what they wanted to get out of the negotiations that they knew would be required. They said that price meant everything to them – they could only afford to spend so much money.

Dear reader, clearly we were starting off on the wrong foot. The problem is that my friends were looking at the negotiations for the house that they wanted as a pizza. Assuming that that pizza had been cut into 10 slices, they wanted to make sure that they came out of the negotiations with at least 6 pieces and not 4 pieces. This is not win-win negotiating.

In their quest to get the house that they wanted at the lowest possible price, my friends were approaching the negotiations as a contest – a contest that would have a clear winner and a clear loser. No wonder they were nervous!

A Better Negotiating Pizza

Win-win negotiating has everything to do with how both sides of the table feel after the negotiators are done. If somebody feels as though they’ve come away with less pizza than the other side, then it wasn’t a win-win discussion.

What you need to do is to make the pizza BIGGER. That way it doesn’t become a matter of who gets how many pieces, because both sides actually walk away with more pizza.

In working with my house buying friends, I asked them where they had some flexibility – what else could we add to the negotiations besides just price. It turns out that they were flexible on when they could take possession – they didn’t need to move in immediately. Also, my friends are handy fixer-uppers and so they were willing to make changes to the house – the current owners didn’t have to actually have the work done.

Final Thoughts

In the end, these two additional negotiating points were what allowed my friends to successfully close the deal. The current owners had not yet picked where they wanted to move to so having more time to get out of the house was very important to them. Additionally, they had a lot of fancy furniture that they didn’t want to have to worry about covering while the house was being painted, etc. My friends got the house for a fair price and everyone went away with more than enough pizza.

Sales negotiators who learn how to make the pizza bigger for both sides of the table will be able to close better deals and close them quicker.

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

What We’ll Be Talking About Next Time

The single  most important factor in determining how a negotiation is going to turn out centers on a single question: who has the most power? The big problem that most of us have is that we don’t think that we have enough of it. Turns out, we’re generally wrong about this…

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Posted in winning | No Comments »

Sad Sales Negotiators Do A Bad Job

Tuesday, August 11th, 2009
Scientists Have Discovered That Sad Sales Negotiators Do A Bad Job <br>(c) - 2009

Scientists Have Discovered That Sad Sales Negotiators Do A Bad Job (c) - 2009

In the quest to do a better job at negotiating deals, sales negotiators have been known to do some pretty wild things in order to condition themselves to perform at a high level – extreme exercising, exposure to hot / cold temperatures, and even eating some pretty weird things. However, is it possible that they’ve been overlooking the most important thing – how happy they are?

The Power Of Sad

Dr. Robert Cialdini has spent a lot of time studying how we can persuade others and how they can persuade us. In fact he’s written a popular book on the topic titled Influence: Science and Practice in which he talks about what causes us to do things that we may not be giving a lot of thought to.

When it comes to sales negotiations, Dr. Cialdini and his peers have done some interesting studies that should cause all of us to sit up and take notice.

The Big Guess

The social scientist who were doing the research started with the hypothesis that when we get sad, we get motivated to do something to change our current circumstances in order to get out of our sad mood.

They took this thinking one step further. They also guessed that sad buyers would be willing to pay higher prices for a given product and sad sellers would be willing to sell a product for a lower price.  Do I have your interest now?

The Experiment

The cool thing about being a social scientist is that you get to test your hypothesis on people, not rats. In this case the scientists had their (human) test subjects divided into two groups. One group watched a sad movie and then wrote a paragraph about how the movie made them feel. The other group watched a movie about fish (!) and then wrote about what they had done that day.

Next, both groups were once again divided into two groups and one group was asked to mark on a piece of paper what price they would sell an item at and the other group was asked to mark on a piece of paper what price they would buy an item at.

What the scientist discovered just might scare you. It turns out that their original guess was right: sad buyer ended up being willing to spend 30% more for an item than emotionally neutral buyers. Likewise, sad sellers were willing to sell an item for 33% less than emotionally neutral sellers. The really spooky part of all of this is that the sad buyers and sellers had no idea that their sadness had affected them so much.

Final Thoughts

Although we often get caught up in preparing for our next sales negotiation, what the social scientists have discovered is that we bring everything else that is going on in our lives to the table with us. On a similar note, the other side of the negotiating table does the exact same thing.

Before you start  your next sales negotiation, you need to take a minute or two and evaluate how you are feeling. If there is anything that is bringing you down or making you depressed, then you have got to try to find a way to resolve it or at least make it better before the negotiations start. Learn to do this and it will allow you to close better deals and close them quicker.

Questions For You

Have you ever gone into a sales negotiation feeling sad? How did that negotiation turn out for you? Have you ever negotiated with someone who was clearly feeling sad? Did you do better than you normally do in that deal? If you are feeling sad, what do you do to make yourself become happy? Leave me a comment and let me know what you are thinking.

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

What We’ll Be Talking About Next Time

Welcome to the new world order: consumers are learning to haggle. In the extended global economic recession, consumers who never used to even think about bargaining are suddenly starting to haggle over every deal. Is this a good thing or a bad thing?

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Posted in persuasion | 1 Comment »

Video: Negotiating With Vendors

Tuesday, August 4th, 2009

So this time around, we’re going to do things just a bit differently. There’s a video that has been going around on YouTube that does a pretty classic job of capturing just how ridiculous negotiating between vendors and clients can be.

The video is just a bit over two minutes long, but in three different situations it does a great job of capturing the vocabulary that we hear over and over again when clients try to negotiate with vendors solely on price.

We’ve talked about it before, but this video is a great reminder that when you are getting ready to enter into a sales negotiaton, you need to have identified ALL of the different points (including price) that are up for negotiation.

Here’s the video, enjoy!

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

What We’ll Be Talking About Next Time

In the quest to do a better job at negotiating deals, sales negotiators have been known to do some pretty wild things in order to condition themselves to perform at a high level – extreme exercising, exposure to hot / cold temperatures, and even eating some pretty weird things. However, is it possible that they’ve been overlooking the most important thing – how happy they are?

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Posted in vendor | 4 Comments »

C’est La Vie – French Lessons For Sales Negotiators

Tuesday, April 28th, 2009

Sales Negotiations With The French Requires Understanding Of Two Key Differences

Sales Negotiations With The French Requires Understanding Of Two Key Differences

So what is your view of the the French? Is your view of this magnificent county and its people shaped by those Inspector Clouseau movies that you used to watch while you were growing up? If it was, then it’s time to get over it and move on – they negotiate much differently than you do.

As with all things in sales negotiations, there is no right or wrong as long as you are able to eventually reach a successful conclusion to your sales negotiations. The trick when dealing with the French is to realize that they approach negotiations differently than either Americans or British do.

There are two key characteristics that every sales negotiator needs to know when dealing with French negotiators. The first is HOW they approach sales negotiations, and the second is HOW they view concessions.

In all honesty, we Americans always seem to be in a rush when we enter in to a negotiation – we work from the bottom up. We pick the first point, try to hammer out an agreement, and then move on to the next point. The French have a completely different approach – if I had to use a 50 cent word I’d call it a more “holistic” approach.

The French prefer to work on a sales negotiation from the top down. They’ll try to reach agreement on the basis of some broad principles first, and spend time working out the details. While they are working out the details, they will constantly refer back to the central agreement on the broad principles. Since you start from a point of agreement, it always seems like the rest of the work is just sorting out the details and that an agreement will eventually be reached.

When it comes to concessions, the French have a very strong sense of quid-pro-quo: they always want to get something in return. Unlike Americans, the French have no problems tying strings to their concessions – you are going to have to give something up if you want to get them to give in on a point.

There you have it, it is possible to reach a successful sales negotiation deal when the other side of the table is French. You just have to remember that their approach to the negotiation and to concessions will be different than yours and you are going to have to change to make the deal work out.

Have you ever had a chance to participate in a sales negotiation when the other side of the table was French? Did they seem to be approaching the negotiation in a top-down fashion? Did you end up giving up something every time they made a concession? Leave me a comment and let me know what you are thinking.

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Posted in how to negotiate | 2 Comments »

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