1. Never negotiate with anyone who is not qualified to negotiate.
If in doubt, ask your contact how they’ve handled a similar type of negotiating in the past. Listen for names, dates and other details that will provide clues as to their level of responsibility.
2. Never put things into writing unless you’re prepared to live with them.
Once an item is put into writing, it becomes an anchor either for you or the customer. This is especially critical when negotiating with a professional buyer who will use anything put into writing as leverage.
3. Always have room to give something the other person will deem as a perceived benefit.
This is why it is so important to sell first and negotiate second. By selling first, you have the opportunity to ask questions and validate the key benefits for which the customer is looking. During the negotiation phase, a customer will attempt to mask the benefits they desire, making it harder to determine exactly what the customer wants.
4. Know when to walk away and be confident in doing so.
To execute this requires the walk away point being shared in advance with others to ensure accountability is in place if and when this tactic has to be used.
5. Know at least 5 things the other person wants that you can offer.
Again, this is why it is so important to sell first and negotiate second. By doing so, it will be possible to know in advance of the negotiation phase what can be offered.
6. Know at least 5 things you can say that will discount what the other person is offering (price not included).
Never negotiate on price. Negotiate using other items, such as technical performance, operational efficiencies, etc. that will provide the leverage needed to avoid a price-oriented discussion.
7. Always treat the other person with respect and dignity.
Negotiate over things and services, not personal matters. Never allow the negotiation to become personal in nature. This even applies to those situations where a close personal relationship may exist. A quick rule to keep in mind: If the relationship is so good, then why is anything being negotiated anyway? If a negotiation does become personal in nature, do not hesitate to step away and arrange a follow-up time to resume negotiating.
8. Never enter a negotiating process until both sides are clear on what is being negotiated.
At the start of a negotiation session, it is appropriate to state exactly what is up for discussion. By doing this up front, it’s possible to avoid a waste of time and, more importantly, inadvertently negotiate things that don’t need to be discussed.
9. Use the sell/buy approach first.
Only move to a negotiating phase if you are unsuccessful closing the sale first. Minimally, no negotiating should begin until the customer has rejected the close at least twice and the customer has provided you with at least one buying signal.
10. Never offer up options until after you’re deadlocked on price and the customer has provided you with additional information.
This includes providing you with a buying signal and credible benefits as to what the customer is looking for.
11. Always put the negotiated outcome in writing immediately.
Do not leave issues open for further discussion. The person who puts the outcomes in writing first wins by being able to position things in the manner they want them to be. Putting things into writing first also provides the opportunity to make one final modification with minimal risk.
12. Upon reaching an agreement, thank the other party, but do not celebrate!
Celebrating the outcome of a negotiation sends the signal to the other party that they have been taken advantage of. Sending this signal will jeopardize the long-term potential of the relationship.