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15th October 2018

The Key to Successful Negotiation

Two businessmen shaking hands in Beijing, China, view from below

 

We hear on the news on an almost daily basis about the Brexit negotiations. This tennis-like back and forth rally between the key negotiators is almost like a soap opera. There are plot twists, and changes in the balance of power.

TIP – For the Day

There are three things to consider in the preparation of a negotiation.
Time
Information
Power

The person under time pressure is at a disadvantage. How often are we reminded about the March 2019 deadline?

The person with more information is at a great advantage. If you know that they are really desperate for certain terms, but that they do not know that you know then you are at a great advantage.

The person with the various elements of power described above is at a great advantage.

One moment there seems like a deal is on the cards and then something tips the balance back to the possibility of a “No Deal Brexit.” Each side is trying to gain the upper hand and negotiate the most favourable outcome.

So, in a negotiation, one should examine these three issues with care during the preparation.

This is very much like selling. Half the battle with both qualification and the final negotiation of the price and terms is for the salesperson to take off the salesperson’s hat and put on the businessperson’s hat.

A Practical Example: Selling a House

Ken was the Sales Training Manager at Unisys in the UK. He told me an interesting story about the time he was selling his house.
It was on the day that contracts were to be exchanged. The appointment was set for 11.00 a.m.

At 9.00 a.m. the phone rang. It was the buyer.

“I’ve been thinking about this purchase. If you take the cupboard out of the dining room then the wallpaper behind it will be a little less faded than the wallpaper around, so we will have to redecorate the whole room. And if you take the carpets out, we will have to paint all the skirting boards.”

“What are you trying to say?” asked Ken.

The buyer then said, “I would like to take the house, but you are going to have to drop the price by £3,000 to cover our redecorating costs.”

The buyer was trying a major power play at the end of the sale.

However, Ken knew a few things.

Firstly, he knew that the buyer lived in the North of England and was transferring south. The buyer had been away from home during the week for several months. When Ken had met the buyer’s wife, it was clear that she was very keen to get the family together again. Time was on Ken’s side as he was on a company move but only across London. At worst, he would suffer a long drive for a few months.

Secondly, the reason that they wanted to buy Ken’s house was that the wife’s best friend lived next door! Ken had uniqueness on his side.

Thirdly, Ken knew that if he did not sell his house to this buyer then his company would buy the house and sell it later for him, as it was a company move. He had the Luxury of Choice.

So Ken said, “Ok then, in that case the deal is off.”

He hung up. Then he picked up the phone again and rang his wife in the North. This is called lobbying!

He explained to the wife what had happened and then said, “So, I’m sorry but the deal is off.” He hung up.

Ken said that he then sat by the phone for half an hour. Sure enough, after about twenty minutes it rang. It was the buyer who said that he had decided to take the house at the original price.

Ken’s only regret is that he did not have the presence of mind to increase the price.

The seller has power, too!

If you would like your sales professionals to improve their negotiation skills, then talk to us about our Negotiation and Objection Handling Skills 1-day classroom training programme.

To improve your sales productivity and win rates ask about our 1-day Pipeline and Qualification classroom training programme.

Contact us for an informal chat on +44 (0) 113 823 2877 or sales@advancetm.com

 

 
Mike Wilkinson
Mike Wilkinson
Managing Director Advanced Selling Skills Academy

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