QUIZ: Are You Truly Ready to Negotiate?

Even experienced sales professionals sometimes flub when they're negotiating final terms. The main reason for failure at this final stage of the sales process is negotiating too soon, without the information that you need to craft a solid win/win deal.

Here's a quick quiz to test if you know which information is CRUCIAL to have before you sit down at the negotiating table. Here's a list of five pieces of information that might prove useful:

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Even experienced sales professionals sometimes flub when they're negotiating final terms. The main reason for failure at this final stage of the sales process is negotiating too soon, without the information that you need to craft a solid win/win deal.

Here's a quick quiz to test if you know which information is CRUCIAL to have before you sit down at the negotiating table. Here's a list of five pieces of information that might prove useful:

The LEAST useful of the above is:

• A detailed analysis of competitive offerings.The only reason that you would need that information would be if you were about to get involved in a price war against a competitor. If a competitor is still in the picture, you are not involved in a final negotiation. Instead, you are still in the middle of a sales cycle and about to get propelled into a price war. In other words, your sales job is not finished, so it's too soon to negotiate.

• Confirmation that you're the number one choice. If you're not the number one choice, then the only reason the customer is negotiating with you is to get the REAL number one choice to drop their price. You're almost undoubtedly not going to get the business. You also need to know WHY you're the customer's number one choice. Once you know what the customer values about your offering, you can use that information to continually position that your value proposition against any attempt to force you to drop your price.
• The size of the customers budget and who controls it. Unless you're certain that the money's there and the person who controls it is willing to spend that money, you're not ready to negotiate because there's no assurance that a deal is going to take place. Turns out that almost a quarter of all forecasted sales are lost to "no decision." This happens because sales pros forecast deals (and enter negotiations) when it's unclear whether a purchase CAN actually take place.
• The time horizon for spending that budget. If you know when the money is supposed to be spent, you can work through the negotiations more quickly or slowly as the situation warrants. You can work to hit an impending budget deadline, or put the negotiations on ice for a while until the next quarter or fiscal year. Being flexible helps you hit the right note at the right time... and get the deal done.
• An agreement on a quantifiable customer payback. Unless you and the customer have agreed on the the financial value of your offering to the customer's firm, negotiations over price (or anything else) are completely meaningless. A customer that has no idea of the financial value of a deal will ALWAYS push for an ever-lower price, simply to mitigate risk. Ideally, you want the financial value to be so high that price no longer becomes a significant issue.

The post "How to Negotiate with Customers" has a video where Ron explains more on this very important subject.