Successful Business Negotiation Strategies
Your promotion has come through and a whole new set of responsibilities along with it, including business negotiations. Even though you may understand the art and theory of negotiating the best possible deal for your company, sitting face-to-face with the other side can be a daunting experience. What do you need to navigate a successful business negotiation, ensuring the best outcome for your side while maintaining optimal relationships with those across the table?
There’s a lot of different ideas floating around out there, from the “never give in” approach to “making concessions” to get the best deal you can – even if you have to settle. The truth lies somewhere in-between, combining the science of negotiation with the art and skill of the negotiator for the best results.
According to Entrepreneur.com,the basic requirements for a successful business negotiation are:
- Having an iron will
- Doing your homework
- Using your street smarts
- Being disciplined
Forget emotional reactions or thinking this is a game you must win. This is not about you. This is about business and how you can achieve the best outcome for your company.
The first two steps in a successful business negotiation are:
- Be Prepared
- Have a Strategy
According to Forbes, being prepared means you must do your homework before you step into the negotiating arena. Review your opponent’s websites, press releases, articles and search engine results. Find out as much as you can about your fellow negotiator on the other side. See if others have entered into similar deals, and make sure you understand what everyone brings to the table.
Then, you can draft a first version of a potential agreement and run it past your legal department. This allows you to state your preferred terms right from the start. Keep it balanced and not too one-sided, allowing room for flexibility.
Implementing a Successful Business Negotiation Strategy
What about your strategy? Remember to keep your emotions in check. Always keep the negotiations professional and courteous. Burning bridges to get what you want could thwart your chances of coming to a mutually beneficial agreement – the well-known “win-win” outcome. Understand who has leverage, time constraints, alternatives and payments.
Be wary of taking too much time to close a deal, but don’t rush things, either. Don’t be afraid to walk away from a bad deal, and be careful when conceding points. You may think concessions will speed up the process and show your willingness to be flexible when the results could prove to be just the opposite. Remember there are alternatives in any deal. Make sure you understand how to ask the right questions, so you can find other ways to come to terms that are agreeable to both sides.
Only negotiate with the decision maker. There is nothing more frustrating than spending hours working out a deal only to be told that your contact cannot give you an answer because it is up to someone else. Ask to have that person at the table during the negotiation meeting or consider walking away from negotiations until this happens.
Here are the eight most important skills you need for a successful business negotiation:
- Do your research and prepare yourself. Know your opponent inside out. Be positive, confident, well-rested and well-fed before going into the meeting. You need your stamina and energy.
- Check out the opening offer and know your bottom line beforehand.
- Leave your ego and emotions outside. Keep balanced and work to find common ground.
- Use scenarios beforehand to be prepared for any surprises. Practice makes perfect!
- Know your strengths and weaknesses, as well as your opponent’s.
- Be prepared to walk away from a bad deal. Think of it as an opportunity to craft a better deal, not as a personal defeat.
- Negotiate in good faith. Employ active listening techniques and look for common ground.
- Know how to close. If you don’t get everything you want, don’t walk away if you can find a solution that is acceptable to both parties. If the deal won’t work, understand the timing might not be right, not the negotiation.
Don’t be caught off-guard by hard bargainers. Also, know your own BATNA (Best Alternative to a Negotiated Agreement) and your opponent’s BATNA. As with most things, knowledge is power. So, use your knowledge of successful business negotiation to ensure the best deal for your company.