Thoughtful Thursdays - On Negotiation Part 2

Last week I talked briefly about negotiation and why you might find yourself in a situation where you need to negotiate with a prospect or customer. In my experience the bottom line is that they are not satisfied with the proposal and are offering the opportunity to save the sales.

Before you enter any negotiation, it will be to your advantage to be as well prepared as you can be. What is it that you need to know? I asked you to make a list and I would do the same. Here are some key pieces of information that I find essential to have before going into any negotiation.

1. Is your customer/prospect comparing apples to apples? In other words, are you on an level playing field with your competition? Are the product/service offerings equal in value?
2. Are you willing to walk away from the deal?
   
3. At what point you will be willing to walk away from the deal?
4. Crunch the numbers and determine when the sale will not meet your profit expectations. This may be tempered by the strategic importance of making the sale.
   
5. Calculate a dollar value on the gap that is keeping you from closing the sale.
6. Determine alternate ways to make up this gap other than dropping your price. Can you offer additional products and/or services? Will increased volume put you in a better position to work on price? You are looking for ways to add value equal to or higher than the gap your customer perceives.
   
7. What questions do you need to ask?
8. Will you be meeting with the decision-maker?
9. Are you clear on your expectations?

I look forward to adding this list should you wish to leave a comment.

Once you have the information you need, the next step is to plan your approach and that will be the topic for next week.

Good selling,
Richard