The biggest B2B sales opportunities are often quite complex, involving strategic relationships and ongoing business arrangements. Closing these deals often involves some fairly complicated "give and take" negotiating. Unfortunately, many sales pros are more accustomed to simple transactions, where price is the only parameter. This post contains some invaluable sales negotiating advice based on a conversation with James C. Freund, author of the book Smart Negotiating. Check it out:
Here are the nine rules:
- Rule #1: Prepare thoroughly. Collect and evaluate information on leverage, values, sale prices, competition and other factors that will have an effect upon the negotiation.
- Rule #2: Develop realistic expectations. Temper your aspirations with "feasibility" based upon what your counterpart has in mind, and reassess your expectations as the negotiating progresses.
- Rule #3: Know your pricing parameters. When it comes to price, before bidding, know the deal you want and are able justify as being realistic.
- Rule #4: Decide whether to "go first" or not. If you put your own number on the table, you put your counterpart into your ballpark. But, beware, you might accidentally low-ball.
- Rule #5: Give yourself room to maneuver. Leave yourself some bargaining room, but make sure that you have a plausible rationale for the positions that you take.
- Rule #6: Manage the concession process. Let your counterpart know that every concession is meaningful and don't let your counterpart think that holding out will reap big rewards.
- Rule #7: Create and sustain credibility. Buttress any positions that you take with appropriate rationales. Be specific about your facts, and stay detached from the emotion of the negotiations.
- Rule #8: Negotiate until the contract is signed. Don't relax once there's a meeting of the minds because negotiating a written contract is an important final step.
- Rule #9: Know when it's time to close. If the negotiation is going well and you've got most of what you want, don't keep negotiating.
READERS: You have any other tips? I'm sure that many of you have negotiated some complicated deals at one time or another!