Sales negotiation skills aren’t inborn; instead, you learn, practice them until you become a tactful negotiator. Negotiations become successful when you manage to adjust perceived and real differences while preserving customer value, credibility, and profit margins.
In most cases, negotiations are a significantly daunting aspect of the sales process, and even seasoned salespersons still experience last-minute jitters. Although there is no guaranteed approach to get the best results from a negotiation, you can reduce the deal’s chances of getting derailed by mastering the following negotiation skills.
1. Determine the Absolute Bottom Line
The absolute bottom line is the final limit you can give in for securing the business. Clearly defining your bottom of what you are ready to settle for and beyond is the best way to prepare for a negotiation. This definition will prevent prospects from manipulating you. When you accept compromises and negotiations on the fly, you will leave unsatisfied. Keep in mind that you reduce a significant portion of what your business should have earned when you compromise. The absolute bottom line works as your worst-case scenario, and you should blindly refuse anything less.
2. Negotiate With the Primary Decision-Maker
Most sales representatives make the mistake of not negotiating with the key decision-makers. Always deal with the signing authority. The major problem of reaching an agreement with others is that the decision-maker will probably begin the discussion with the discounted price agreed or quoted when you start negotiating with them. The decision-maker uses this quotation as leverage to quote lesser, pushing you in a corner.
3. Get Ready Before Negotiations
Getting prepared before starting the negotiation process can guarantee you 90% success. Preparing in advance increases your chances of getting positive results from the discussion. Get ready for in-depth discussions and plan techniques for each encounter. Get as much information as possible about the prospect you will be negotiating with, think through the whole negotiation process critically, and get ready for any eventuality.
4. Create Value to Justify the Cost
Before entering the negotiations, create value in your prospect’s mind by paying attention to their underlying interests. Quantifying the values the client can get from your service/product helps you convince them easily. Offer your price legitimacy by giving your clients reasonable justifications. Keep in mind that most clients purchase benefits and values, not features.
5. Offer Cheaper Alternatives to Cash Discounts
Clients always demand rebates and discounts from the given price. To counter such demands and claims, provide the clients with alternatives to cash discounts that will cost you less in comparison. However, ensure you offer options that resonate with high value to your customers.
6. Be a Good Listener
Listening skills help you learn more about your prospect’s interests and collect information that can help you enhance your bargaining position. It helps you know your client better and encourages your clients to talk to you freely. Paraphrasing your prospect’s points to clarify any confusion can make them feel valued.
7. Control Your Emotions
You must keep your emotions in check and recognize your prospect’s emotions during the discussion. Although negotiations can be frustrating sometimes, allowing your emotions to take control during the process can result in undesirable results, including losing the client and a chance to create a long-term mutual relationship. Controlling your emotions during sales negotiations allows you to stay calm and focus on significant issues.
8. Practice Silence
Silence plays a significant role in negotiations. It makes the other party think critically about your offer and strengthens what you said. Although “silence can speak louder than words,” it can become counterproductive if you do not have adequate training on managing it. It creates a void that the client gets forced to fill with words that will probably favor you.
9. Practice Patience
If you manage to make decisions that might need some changes to what you initially agreed on, don’t rush into closing the deal. Take time and thoroughly assess the situation. These changes might catch you unawares, and rushing into finalizing the sale can only affect you and your business’s bottom line. So slow down, take a break and get in touch with them after assessing the situation critically.
10. Walk Away, If Need Be
If the client demands radical changes to the agreement or significant price deductions that can hurt your business’ profits, walk away. This way, you will send signals that express your dissatisfaction.
As you master these skills, ensure you are constantly working on building good relationships, knowing client needs, and offering solutions. As a result, you will get better and more consistent outcomes, which will lead to a higher return on your investments.
Similarly, consider reading the Differences between A Seller and A Distributor!