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Sales Negotiation Tips

Contractual terms, pricing, shipping terms, service levels, quantities – all kinds of items end up being negotiated during the sales process. This is often the case once a client and sales professional have agreed to the basic components of a sale.  Yet, far too many sales professionals struggle when a sales opportunity is log-jammed in a unproductive or difficult negotiation.  Since sales negotiations are more often the rule rather than the exception, it pays to know a few simple rules on negotiations.  The Seven Ds of Sales Negotiations will enable you to work around obstacles and find solutions that are mutually satisfactory to both you and your customer. 

Do Your Homework
Entering into a negotiation without preparing can be downright disastrous.  We always advise that a sales professional spends time researching the customer, their needs and the company before heading into a negotiation.  Having a better feel for where a customer’s interests and needs will enable you to anticipate possible issues and know how to deal with them if they come up.  This strategy will also help you stay out of trouble.  Imagine selling a large order and negotiating for very favorable financing terms for the customer.   Two days after the products are shipped, the customer declares Chapter 11.  If the sales rep had been paying attention, he would’ve seen that the client was in deep financial trouble.

Determine Where You Stand
Before you go into a negotiation, do you know what concessions you are willing to make?  Do you know what you would want from the customer in return?  Are you aware of your best price and what you’d really like to get?  Sales professionals need to know as much about what they expect as they know about the customer.  Before going into a negotiation, know what you want to get, what you are willing to accept and the least attractive option that is still doable.  You should also know at what point it makes sense to walk away from the negotiating table.  Determine any interests you might have that will come into play in a negotiation.

Deal with Those Who Have Authority
There’s an old saying, “don’t talk to the monkey if the organ grinder is available.”  It’s a funny saying but it is very profound.  Ultimately, there’s no sense negotiating with those who don’t have the authority to make decisions.  If you’re negotiating with someone who doesn’t have the final word, ask them to bring in the decision maker.  It will save everyone a lot of time and frustration.

Dig Deeper
You are in the midst of a negotiation and the customer has made an unreasonable request.  Perhaps they’ve hit with some terms that are out of left field.  Why did they do that?  Well… that’s the point.  You’ll come across all kinds of information in a negotiation.  Rather than accepting it at face value, ask questions to find out why a customer needs something.  Is there a reason they need specific payment terms?  When you are presented with new or unexpected information, dig deeper to find out the who, what, when, where, why and how of the situation.

Don’t Let Time be Your Enemy
Time can be used to your advantage or your disadvantage.  If you’re trying to close a big deal on December 31st in order to make your numbers for the fiscal year, time is to your customer’s advantage.  Don’t let yourself get tripped up by impending deadlines or time restrictions.  Know how to use time to your advantage.

Discuss with the Future in Mind
Whenever you are negotiating, you need to stay focused on the long-term aspects of the deal. Most of us care about building long-term relationships that are mutually beneficial. Don’t try to rake your client across the coals in order to get the big sale. Work together with your client to come up with solutions that will allow both of you to walk away happy. Slash and burn tactics work but they usually only work once. After that, the customer will be calling your competition.

Deal with Difficulties
Difficult negotiation situations come up all the time. Realize that when you deal with a difficult negotiator, there may be more than meets the eye. Some customers are simply having a bad day and are inadvertently taking it out on you. Others may be trying to rattle your cage to see if it will affect you. Some just don’t realize that their personality is difficult. Whatever you do, stay calm and don’t act irrationally.  Don’t take difficult behavior personally. If a topic is getting out of hand, sometimes it helps to simply call for a break or ask if the topic can be shelved for the time being. Sometimes, briefly walking away from that situation is all it takes to get things back on track.

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