Negotiating

1
Negotiating

• Chapter 13

2
Negotiation

• The bargaining process through which buyers and
  sellers resolve areas of conflict and/or arrive
  at agreements
• Two basic approaches
• Win-lose negotiating
• Win-win negotiating

3
Negotiation Versus Nonnegotiation Selling

• Good salespeople are not necessarily good
  negotiators
• Extra-intensive planning needed for negotiation
• Formal negotiations are usually only for large or
  important prospects

4
Scheduling the Negotiation Session

• Neutral location
• Free from distractions
• No home court advantage
• Morning
• Middle of the work week
• Avoid time pressures if there is likely to be
  win-lose negotiating

5
Negotiation Objectives

• Power
• Concessions
• Set several objectives
• Target position
• Opening position
• Minimum position
• Adaptive planning

6
Preliminaries

• Break the ice
• Ensure a comfortable environment
• Prepare an agenda

7
General Guidelines

• Listen carefully
• Keep track of issues discussed or resolved
• Consider cultural differences
• Remember that people need to save face

8
Win-Lose Negotiator Tactics

• Ambush negotiating (sneak attack)
• Unfavorable room situation
• Good guybad guy routine
• Lowballing
• Nibbling
• Emotional outbursts
• Budget limitation tactic (budget bogey)
• Browbeating
• Negotiation jujitsu

9
Making Concessions

• Never make concessions until you know all of the
  buyers demands and opening position
• Never make a concession unless you get one in
  return
• Concessions should gradually decrease in size
• Dont be afraid to say no
• All concessions are tentative until the final
  agreement is reached and signed

10
Making Concessions

• Be confident and secure in your position and
  dont give concessions carelessly
• Dont accept the buyers first attempt at a
  concession
• Help the buyer to see the value of any
  concessions to which you agree
• Start the negotiation without preconceived
  notions
• If you realize you have made a mistake, tell the
  buyer and begin negotiating that issue again

11
Making Concessions

• Dont automatically agree to a lets just split
  the difference offer
• Remain noncommittal when customer asks for a
  bottom line price
• Know when to stop
• Use silence effectively
• Plan the session well

12
Recap of Negotiation Meeting

• Be sure to get any negotiated agreements in
  writing
• Do post-negotiation evaluation and learn from
  your mistakes
• More cooperation exists if both sides expect
  future interactions
• Dont be greedy or pushy