Negotiations are usually the most daunting aspect of any sales representative’s sales process. Even experienced sales managers still get last-minute jitters! Probably because profit, relationships and deals are either won or lost during the negotiation process. What’s more, you’re not born with these skills; instead, they’re learnt, practised, and fine-tuned until you become an effective and tactful negotiator. If you want to master negotiations to maximize your profit, win rates and opportunities for repeat business, read on below to master these 10 essential negotiation skills every salesperson should have!
- What You Need To Know About Win-Win Negotiations
- 5 Steps For Overcoming Stalled Negotiations
- How To Uncover Hidden Agendas During a Negotiation
What is a sales negotiation?
The purpose of a sales negotiation process is to have a strategic discussion (or discussions) with your customer that ideally leads to the deal being confirmed and closed. Ultimately you want to reach an agreement that’s agreeable to everyone.
Key sales negotiation skills
With the right strategy and sales negotiation skills, your future negotiations can result in a mutually beneficial outcome for all parties. Here are 10 negotiation skills you need to master to protect long-term relationships and profit in the process.
The statement ‘fail to prepare and prepare to fail’ really epitomizes our first negotiation skill – arrive prepared!
You might be thinking, “I’m a Sales Professional, of course I’ll arrive at the negotiation prepared!”. However, did you know being prepared accounts for 90% of your sales success? Therefore, this statistic is why you need to double or even triple check you have:
- Extensive and comprehensive research on your prospect and their operation.
- Proof or evidence in the form of testimonials, data, or case studies.
- Created a detailed description of your prospect’s problem and a plan depicting your solution.
Preparation is vital for any sales negotiation, so please don’t get caught out by not knowing your information. Instead, use this essential sales negotiation skill to ensure you win that deal! Because if not, you’ll appear unreliable, unprofessional and definitely won’t be walking away with a closed deal.
2. Being Human
Negotiations are usually formal events; however, we’re all human here, which means you possess the ability to connect with your prospect. Therefore the next sales negotiation skill is about the energy you bring to the table.
First, you need to ensure you’re practising effective body language techniques to ensure you keep the conversation light, airy, and comfortable. Consider using other little tokens of humility. For instance, have a drink available, relax the mood with casual chit-chat, and even just commenting on the weather will go a long way.
Not only will you get the result you want, but you’ll start building a consistent and robust rapport and ultimately form long term business relationships. Therefore don’t hesitate to use this sales negotiation skill to put your best foot forward and secure that deal!
Ever heard of the adage, ‘silence speaks louder than words?’ Either way, we’ll let you in on a secret – it’s one of the most potent sales negotiation skills you can have in your arsenal.
So how does it work? Well, merely asking a question like “Are you willing to pay $X?” and then being completely silent will compel your prospect to fill the silence. Active listening will not only relay that you’re negotiating from a solid position but that you have unwavering confidence.
This excellent and rather sneaky tactic will reinforce your statement and persuade your prospect to start considering your offer. However, be mindful not to create awkward voids of silence – there’s nothing worse. By tactfully utilizing this sales negotiation technique, you can make an offer, stay silent, and wait for your prospect to say yes.
4. Defining discounts in advance
Have you ever over-promised in the heat of the moment, just to secure a deal? Then this negotiation skill is definitely for you. It’s important to start all negotiations by planning out in advance what you’re able to sensibly offer in terms of freebies, discounts, and concessions.
This is all called defining your bottom line and your walk-away point. Don’t let pressure and uncertainty control the path of your sales negotiation because ultimately, it will only lead to you losing even if you ‘won.’
By knowing your absolute limits, you’ll ensure you aren’t manipulated into conceding to your prospects Price Objections or a deal you can’t happily deliver on. Any offer that’s less than your bottom line should be dismissed, and alternatives pursued instead.
5. Allow the prospect to begin
We all know the importance of creating an accommodating environment free of aggression and pressure. Therefore, we strongly suggest that you allow your prospect to start the Sales Negotiation.
Not only is it a polite gesture, but it gives you the upper hand! Think about it, by giving yourself a chance to scope out the scale of their offer – you can use this time to alter your terms if needed. So, it’s imperative always to allow your prospect to begin the negotiation dialogue.
6. Identify & include decision makers
During sales negotiations, you need to be aware of who makes the final buying decision. Whilst this negotiation skill sounds incredibly obvious, trust us – you could be pitching to someone who doesn’t even hold the authority to confirm a sale.
For instance, you could be pitching to administrative staff whilst your competitors are pitching to the boss. If this is the case, there’s no chance you’ll be getting the sale.
You need to actively find out if there are multiple decision-makers involved because you’ll need to find a way to present your solution based on everyone’s interests. Here are some questions we suggest you ask to help you identify the decision-maker immediately:
- Will anyone else be involved in the decision?
- Who else should we have at the meeting to make sure I can address everyone’s questions?
- Who will be the end-user of our solution?
- Do you want to invite the [insert buyer’s role] to our next meeting?
7. Demonstrate value
Don’t even think about negotiating the price or giving discounts and concessions until you’re confident you’ve fully demonstrated the value of your product or service.
If you find yourself trapped in a price negotiation where all the prospect is thinking about is the price, you’re setting yourself up to either lose the deal or, worse, the profit.
Instead, you need to use your negotiation skills to justify your price with evidence. Do you have qualitative or quantitative data you could present to your prospect to show why it’s worth what you’re asking? How about testimonials, case studies, and reviews? These are excellent ‘proof devices’ that demonstrate to the prospect how valuable your offering is.
8. Know when to walk away
You might find instances during sales negotiations where prospects might make demands that your business just can’t facilitate; whether that involves radical amendments or colossal price reductions, it’s important to know that you have the option to walk away.
However, it would be best if you tried first to slowly disengage from talks by displaying your dissatisfaction with how the process is evolving. If the prospect isn’t picking up on your signals, gracefully bow out of sales negotiations to save you both from wasting time and effort.
Have you ever considered offering a break in the sales negotiation? Yes, it might seem radical or downright insane – but, it gives both parties a chance to review any significant requests or changes away from the spotlight.
Think about it. Nobody wants to rush into a deal they’re not 100% happy with – so it’s imperative to slow down, take a break and thoroughly evaluate the situation now and again. Practising patience is a crucial negotiation skill you should think about incorporating.
10. Ask for something in return
You’re about to enter a working relationship that requires total respect and trust from both sides to be beneficial. The last skill you should practice is asking if you can receive something in return for concessions you’ve offered or requested by the prospect. This ensures that everyone leaves the negotiation in a win-win situation, which will only help your working relationship prosper.
Confidently navigate Win-Win negotiation strategies to uncover opportunities & profit
You may think that because successful negotiators appear to arrive armed with the tools and skills needed to negotiate effectively, their desired outcome of a closed deal and profit are optimised.
The thing is, profits and closed deals aren’t the only desired outcome; preserving the relationship is also crucial to ensure long term business opportunities.
This opportunity is why we recommend sales professionals, procurement departments, senior managers, and business leaders undergo Negotiation Skills Training.
Join now to learn how to navigate effective negotiations in a way that results in a positive outcome for both parties and inspires future business.