Entrepreneurs Brief Guide
“How to Negotiate”
Dr Jim Porter
For many start-ups, negotiation is considered as a waste of time and embarrassing. However, as a seller, it is important to have good negotiation skills so that you do not waste money by needlessly giving out discounts or missing out on the chance to increase your sales.
In 30 minutes, learn how to:
Set a negotiation strategy and objectives
Be confident when negotiating
Purchase at lower prices and sell at higher prices
Seal a good deal
Copyright
How to Negotiate
Dr Jim Porter
Revision: SW2.015.001
Copyright © 2011 – All Rights Reserved.
Smashwords Edition
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ISBN:
978-1-4659-0514-7
Publisher: Smashwords, Inc.
For many start-ups, negotiation is considered as a waste of time and embarrassing. However, as a seller, it is important to have good negotiation skills so that you do not waste money by needlessly giving out discounts or missing out on the chance to increase your sales.
Some important rules
Every deal is different from another therefore there is no single formula for successful negotiation. However there are some guidelines which you can refer to:
You must always have a well-defined set of objectives. For example, for selling you might have the key objectives of a) an acceptable price b) a standard volume of production and c) the best feasible payment terms with your buyers.
You must try to understand from the other side’s perspective as well. They might have issues relating to their own objectives of price or timing of delivery. Sometimes your opponent may not be ready to concede; in this case you must know your opponent’s negotiating position so that you can strike the deal in your favour.
You must always try portraying the deal as a ‘win-win’ situation for both sides. By convincing the customer of the benefits they will receive by buying your products and by offering value for money, you can ensure a healthy long term relationship with them. Also, avoid making concessions without ensuring you’re getting something in return.
Having a written negotiating strategy is helpful as it helps in defining everybody’s role. On it you should list your objectives, some of the concessions that you believe you are ready to offer and your negotiating tactics.
Setting objectives of negotiating
When setting objectives for sale or purchase negotiations, you need to consider a range of key issues:
Price and value for money
Delivery
Payment terms
After-sales service and support
Quality and compliance standards
Life-time costs of a product or service
Whether or not the product or service is essential to your business