Posts Tagged ‘win-win’

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Sales Negotiations: How Do You Get From The Middle To The End?

Friday, July 23rd, 2010
Image Credit Crossing The Finish Line Is The Goal Of Every Sales Negotiation

Crossing The Finish Line Is The Goal Of Every Sales Negotiation

How many times has this happened to you: there you are, you’ve jumped into a sales negotiation and started off with your initial negotiating position. The other side did exactly the same thing. You are miles apart and it seems like there is no way that you are ever going to bridge the gap. What do you do now?

Movement Is Good

Although it sure can feel mighty lonely when you are in the first half of a sales negotiation, take heart – this is exactly what needs to happen. Both sides always start far apart, have some conflict and stake out their positions. This is when things start to really get interesting.

Expert sales negotiators realize that after all of this posturing is done is when the real work of crafting a deal really beings. Yes, there is a lot of distance between where you and the other side of the table sit right now; however, it’s up to you to find ways to narrow that gap.

Your job is to knuckle down and look for which issues you and the other side are closer together on. These are where you can initially spend your time trying to find ways to move closer to an agreement.

Your negotiating strategy and the other side’s will be in flux at this time. You’ll try different things and some will work, some won’t. You will test the other side’s commitment to some of their positions and they’ll do the same with you.

Much of this stage of the negotiation is based on power. You will be working to find out just exactly what the other side really wants to get out of the negotiation. The goal of this phase is for both sides of the table to come away with the belief that a deal is possible.

Into The Fire

It takes a lot of guts to be a good sales negotiator. You’ll have to prove yourself when you move to the next stage of a negotiation – this is when the hard bargaining starts.

Both sides realize that a deal is possible. However, you’ll change your tactics. You want to end up with the best deal possible and that means that you need the other side of the table to make as many concessions to you as you can get. Unfortunately the other side of the table is thinking exactly the same thing.

This is where the bare-knuckle brawling really comes out. Different sides threaten to leave, do leave, come back, etc. Pretty much every negotiation tactic in the book gets whipped out and tried during this phase of the negotiation.

This is a very difficult part of the negotiation to make it through. However, professional sales negotiators do make it through by realizing two important things: where they currently are, and where they are close to being. They know that if they can stick with it, they’re almost done.

Striking A Deal

You will never be able to negotiate the perfect deal. What will happen is that you’ll push and push to get a better deal and eventually you’ll hit the brick wall at the end of the tunnel – you’re not going to get any more from the other side.

When this happens, you’ve reached the end of the negotiation. You need to take a moment and asses where you are. Can you live with the deal that is currently on the table?

You need to realize that if you can’t, then you are going to have to start negotiations all over with another partner. However, if you can live with the deal, then you are very close to being done.

Assuming that the deal that gets written down accurately reflects what you think that you verbally agreed to (it doesn’t always!), then you’ve successfully negotiated a deal.

What All Of This Means For You

Inexperienced sales negotiators can often get lost in the middle of a sales negotiation. They know how to start the negotiation; however, once it’s under way and they realize just how much distance there is between their position and the other side’s, they don’t know what to do next.

The correct thing to do is to realize that you need to spend time working to close the gaps. Once this has been done, you will be in for some hard negotiating in order to move towards closure. A deal isn’t done until both sides can agree on a written version of the agreement.

Professional sales negotiators have a secret weapon. They never give up hope no matter how difficult things get. That’s what makes the deals that they reach feel so good for both sides of the table.

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: How can you tell when you’ve reached the end of a sales negotiation?

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

What We’ll Be Talking About Next Time

We all know that power is an important part of any sales negotiation – who ever has the most power is in the best position to get more of what they want out of the negotiations. However, do you know how to check your power before you enter into a negotiation? I know the questions that you need to ask yourself before you start and I’m going to tell you what they are…

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4 Ways To Win A Sales Negotiation Before You Even Start

Friday, June 18th, 2010
Image CreditThe Secret To Winning Is To Cross The Finish Line Before You Sit Down

The Secret To Winning Is To Cross The Finish Line Before You Sit Down

Have you ever wished for three wishes? Maybe you’d keep one of these wishes in you back pocket and then someday when you found yourself in the middle of a sales negotiation that just wasn’t going your way, you could whip it out and come out a winner? Well, I don’t have any wishes to share with you, but I’ve got some ways for you to come out of your next negotiation feeling like you won it before you even started…

Plan On Getting To Win-Win

When we talk about the fabled “win-win” state in sales negotiations, what we’re really talking about is reaching a point in which both sides of the table feel as though they’ve gotten what they need and that they haven’t given up too much.
Getting to win-win doesn’t just happen. Instead, you have to plan on getting there. Taking the time before you start a negotiation to give some thought to just exactly what a win-win situation would look in the upcoming negotiation and then writing down how you might get there will make achieving this state that much more possible.

Divert Power To Your Defensive Shields

Anyone who has spent time watching old science fiction movies knows that before you take your starcruiser into battle you first activate and fully charge the defensive shields. It turns out that the same is true for sales negotiations.
It’s entirely possible that you may find yourself getting forced into a corner at some point during a negotiation. If this happens, then you need a defensive shield that you can activate. Two classic shields are the “I need time to think about this” ploy and the “appeal to a higher authority” ploy.
If you want to use these defenses correctly, then you need to take the time before the negotiations start to set things up so that you can use them: talk about your control-freak of a boss or how you ALWAYS need to spend time by yourself before making a big decision.

Clone Yourself

Remember back in school when the kids used to call the kid who wore glasses “4 eyes” (maybe it was you)? Well it turns out that having four eyes is actually better than having just two – in fact another set of ears can sure help out also.
Since we haven’t quite got that cloning thing squared away just yet, your best bet is to bring a colleague along with you to your next sales negotiation. There’s no way that you can possibly see everything, hear everything, or remember everything so having another person there who’s on your side can be a big help.

Find The Other Side’s Kryptonite

More often than not, you may feel as though you are getting ready to negotiate with Superman. They seem to have everything: more people, more resources, and a better starting position for the negotiation.
In reality, it turns out that their greatest strength is that you think that they are in a strong position. Before the negotiation starts, take some time to consider the world from their position. They really don’t have Superman’s powers – there has got to be some limits to what they can do. If you can identify these limits, then you will have taken away some of their power and boosted yours.

What All Of This Means For You

Everyone wants to walk away from their next sales negotiation feeling like they came out ahead. Sure you can just dive right in and hope for the best, or you boost your odds and take some steps to position yourself to succeed before the negotiation starts.
We’ve covered four steps that you can take in order to prepare for success. They all require you to find a quiet place and then mentally think though the upcoming negotiation and plan your moves. If you think about it, it’s really like getting ready for a chess match.
It is possible to position yourself to be successful in your next negotiation. All it takes is just a little bit of advanced planning and you can be a winner before you even start the race…

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Help For Technical Staff

Question For You: Do you think that the person that you bring along should work for your company or be an outsider?

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

What We’ll Be Talking About Next Time

I’m pretty sure that any sales negotiator who was given a choice would always choose to close a deal quicker rather than slower. Sure, there are probably some masochists out there, but let’s assume that everyone else would choose the quicker option. Great, now just exactly how do we go about doing this?

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How To Use The “Pivot Technique” To Defend Your Price During A Sales Negotiation

Friday, June 4th, 2010
Image Credit Good Sales Negotiators Know How To Move Around A Fixed Issue

Good Sales Negotiators Know How To Move Around A Fixed Issue

I just love Ferris wheels. They are generally huge, have the ability to take you way up into the sky and then always bring you safely back down to earth. If you’ve ever taken the time to look at how a Ferris wheel is built, then you already know about one of the key negotiating techniques that top sales negotiators use when they need to defend a price…

How Ferris Wheels Are Like Sales Negotiating

Many sales negotiations get hung up and fall apart when the discussion finally gets around to the issue of price. The reason for this is pretty simple: one side of the table wants a lower price and the other side either doesn’t want to or can’t lower it. End of discussion – both sides shake hands and walk away.

It turns out that things don’t have to end this way. The “pivot technique” is one way that experienced sales negotiators have found to meet this issue head on and not derail the negotiations. One way to mentally picture the pivot technique in action is to think of a Ferris wheel with a center hub and passenger holding cars (gondolas) distributed in a circle around the hub.

The Pivot Technique In Action

Think of the price of your product or service as being the hub of a Ferris wheel – it’s both fixed and unmoving. However, a Ferris wheel with just a hub is no fun at all. That’s why it has gondolas to carry passengers. In the pivot technique these gondolas represent other negotiating points that you can use to make sure that the negotiations continue even when you have a fixed hub.

Although this may seem obvious, during the heat of a negotiation it’s not – you don’t focus on the hub, you spend your time talking about the gondolas. There are a lot of different ways to do this: the number of gondolas and just exactly what is in them is completely up to you.

Don’t get me wrong: neither you nor the other side is going to forget that this is all being held together by an immovable hub. However, as the number of gondolas increases and their contents become more desirable, the hub will cease to become as much of a significant issue.

What All Of This Means For You

A sales negotiation that falls apart because of price is a tragedy that didn’t need to happen. Yes, price is important to both sides; however, the total value of the deal is much more important.

The pivot technique is a tool that experienced negotiators use to get around the problem of having to negotiate with a price that can’t be lowered. By adding additional points to negotiate to the table, we have the ability to build a complete package to be negotiated and this makes the price only a single component of a much bigger deal.

There are no silver bullets in sales negotiations. However, the pivot technique is a powerful tool that can help you avoid having your next sales negotiation come to an end because you couldn’t change your price.

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Help For Technical Staff

Question For You: How many additional negotiating points do you think will be required in order for you to be able to maintain your product’s price?

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

What We’ll Be Talking About Next Time

So let’s say that you were going to drive to some place far, far away. Let’s go a step farther and say that you sorta knew where you were going to go to, but that you had never been there before. Can you imagine yourself just jumping into the car and driving with doing any planning? Believe it or not, this is exactly how some sales negotiators jump into a negotiation…

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Do We Really Need To Negotiate If We’re Going To Be Partners?

Friday, March 5th, 2010
Image Credit Sure You’re In Love Now, But What About Later On?

Sure You’re In Love Now, But What About Later On?

Welcome To The Age Of Partnering

Remember when every business used to view themselves as an island? This made life pretty simple for anyone doing sales negotiations – it was always us vs. them. Well, it sure looks like someone farther up the corporate ladder has been reading those business self-help books and they’ve decided that there is a better way to go about doing things: partnering.

Why Does Becoming A Partner Make Life So Difficult?

So just what is a partner? In simple terms (and it can get a lot more complicated if you let it), a partner is another company with which your company has decided to form a special, deeper, relationship. For a sales negotiator, this new type of relationship can complicate our lives immensely.

Before partnering came along, you had a great deal more latitude in how you conducted a negotiation: simply put, you really didn’t care that much about the other side of the table – you just wanted the best deal for your company. Partnering changes all of this.

The key here is to view a partnership as a bonding of two companies together (dare I say “marriage”? ) This is much different from a simple long-term partnership where you treat the other firm nicely, but you know that it’s not going to last (perhaps “dating” would be the right word here).

What Role Does Win-Win Negotiating Play In A Partnership?

One of the biggest changes that a partnership brings about in the life of a sales negotiator is the arrival (with a “thud”) of win-win negotiating. Instead of having the latitude to walk away from a deal with a partner, you’re pretty much expected to be able to reach an agreement with them. After all, they are a partner, right?

What this means is that the clever sales negotiator (you) now needs to use win-win negotiating techniques to find more things to negotiate about. The more discussion points that you can put on the table, the better your chances are that you’ll be able to craft a deal with your partner.

One important point that often gets overlooked when sales negotiators start to use win-win techniques with partners is that this does not mean that everything gets shared equally. Instead, what it really means is that everyone walks away feeling satisfied – one side may get 60% and the other may get 40%, but everyone feels as though they got what they needed.

Oh Yeah, That Power Thing

Power is a big part of any negotiation – who has it, how much of it they have, and how you can get more of it. You need to realize that just as in the fact that win-win deals don’t mean that everything is shared, the balance of power will always be unequal.

How much power you have often flows from how much information you have about the other side (your partner), and how much information they have about you. Since it’s a partnership, both of you will know more about each other than most parties involved in a standard negotiation would.

Since you know that you will be negotiating with your partner, as a sales negotiator you have a responsibility to make sure that others in your company don’t end up giving all of your negotiating power away. Sure openness is a good thing, but let’s not take it too far.

What All Of This Means For You

The role of a sales negotiator has become more complicated with the arrival of business partnerships. What use to be a relatively simple process of going into a negotiation with the goal of only improving your company’s position has now been changed.

In order to look out for a partner’s wellness during a negotiation, win-win techniques need to be used. This brings up more complicated issues surrounding what makes a deal fair for both parties and just how to make sure that you retain your negotiating power.

Business partnering is not going away. Sales negotiators need to accept this fact and adjust how we go about negotiating with this new type of opponent / adversary / other side of the table. If we can find ways to create deals that fully benefit both sides of the table both today and tomorrow, then we will have come to terms with the brave new world of partnerships.

Question for you: Do you think that negotiating with a bsiness partner is easier or harder than any other type of sales negotiation?

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

What We’ll Be Talking About Next Time

So there you are, all ready to start another sales negotiation. Hold on a minute, are you really ready? Maybe you’ve overlooked the most important point of all – setting your target for the negotiation.

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Why Win-Win Sales Negotiating Never Works And What To Do About It

Tuesday, October 13th, 2009
Win-Win Negotiating Is The Wrong Way To Go

Win-Win Negotiating Is The Wrong Way To Go

Quick: what’s the first thing that you think about when you picture your next negotiation in your mind? Unless you are Mother Teresa’s brother / sister I’ll bet that you saw yourself walking away from the bargaining table with the best deal in the world , you had gotten everything that you had wanted and more. Umm, what about the other side? That’s why win-win negotiating never works.

How Win-Win Negotiating Is Supposed To Work

Too many people have created in their minds a magical world where win-win negotiating (where lions lay down with lambs, money grows on trees, etc.) always works. Instead of worrying about things like price, delivery date, and quantities, you are expected to instead be worrying about how the other side “feels” and what kind of deal will make them “happy“. Balderdash.

I don’t know about you, but I am forced to live in the real world. Flat out I don’t have the time to spend trying to worry about how the other side of the table is feeling today. It may come as no surprise to you that in my experience the other side is not spending any time trying to decode what my lucky mood ring is telling them about my current feelings either.

This kind of Pollyanna approach to negotiating does not work and the folks who go around writing books about it and teaching negotiating courses based on it have created a generation of negotiators who are, dare I say it?, ineffective.

Win-Win In The Real World

I like the part about “win-win” where I win in a negotiation; however, I’m a bit leery about the other side winning also , doesn’t that mean that I lost something? It sure does if I’m sitting at table with you and  a stack of 100 $1 bills and you and I are negotiating about how much of the stack each of us gets. Every $1 bill that you get is one that I don’t get , and I want ‘em all. I’ve been in negotiations like this and they basically suck.

In the real world you and I are sitting at a table on which is a pile of eggs, a chicken, and a pig. Now let’s start negotiating. Maybe I run a restaurant and you run a grocery store. On the surface things look the same as the stack of $1 bills example. However, this time around we’ve each got different needs. We actually might be able to find some common ground.

If I’m running a restaurant, then I’ve got dinners that I’ve got to cook tonight. If you’re running a grocery story then you’ve got to stock your shelves for this week , we’re both trying to solve time related supply issues. Long after the eggs, chicken, and the pig are gone I’ll still need to get supplies for my restaurant and you would love to sell those to me.

For creating my dinners, the chicken and the pig are more valuable to me, for stocking shelves for a week, the eggs and the chicken are more valuable to you. I’d might be willing to give up on the eggs if you’d give up on the pig. In fact when it comes to that pig, I’m interested in using the ham for a dinner and you might be interested in the bacon to go with the eggs that you’ll be selling to people buying breakfast food.

What you’re seeing here is how our self-interests start to overlap. No Pollyanna “I want to hold your hand” stuff, instead I’m still just thinking about myself; however, as more of my drivers are put on the table we’re finding out that you have many of the same drivers. Negotiating a deal that solves more of our common drivers is what’s going to create the best long-term solution.

Final Thoughts

Ever since that dang Getting to Yes book came out, negotiators have been pursuing a mythical unicorn-like type of negotiation , one where everyone gets what they wants and walks away from the table happy.

In the real world, this just simply doesn’t exist. Instead, we find ourselves in a situation where we need to work very hard to make sure that our side of the table’s needs are taken care of because nobody else is looking out for us.

Where there is some hope comes from taking a close look at our self-interests and finding out if there is any overlap with the other side’s. Where we are able to find common ground, we’ve got an opportunity to create a deal that will benefit both of us at the same time. As long as I get my chicken and my part of the pig, I’ll be happy.

Do you think that win-win negotiating has any place in real-world negotiations?

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

What We’ll Be Talking About Next Time

One situation that my students seem to struggle with over and over again is the case where it’s them and a whole bunch of other companies all trying to get the same deal. The other companies appear to be prettier, smarter, and all around better , what chance do any of us have against them?

http://www.theaccidentalnegotiator.com/

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