Negotiations are usually the most daunting aspect of any sales representative’s sales process. Even experienced sales managers still get last-minute jitters! 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 a tactful negotiator. If you want to master negotiations to maximize your profit, win rates and opportunities for repeat business, read on below. 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. One that ideally leads to the deal being confirmed and closed. to do so, you must reach an agreement that’s agreeable to everyone.
Why is negotiation important in sales?
Sales negotiations are valuable for several reasons. Not only do they help buyers and sellers arrive at agreeable deas, but it also helps to build loyal, long-lasting relationships that create lifetime customers. When both parties enter a negotiation in sales and understand the importance of how to negotiate effectively, they avoid conflict and frustration when trying to determine fair prices and mutually beneficial outcomes.
Exploring the importance of fair negotiations in sales even further, you should learn about win-win negotiations -a tool that can benefit both negotiating parties. While also increasing confidence and loyalty in the party you are negotiating with. This is how they work:
Win-win negotiations focus on integrative or value-creative bargaining negotiation techniques. Rather than the traditional haggling or distributive bargaining process that most people use. Instead, the win-win negotiation approach uses an integrative or value-creative bargaining process, so each party learns what the other party wants. Ultimately making it easier to work within those confines or restrictions to ensure both parties walk away satisfied and happy.
10 essential Sales Negotiation Skills
With the right strategy and sales negotiation skills. Your future negotiations can result in a beneficial outcome for all parties. Here are the 10 negotiation skills you need to master. Discover them now to protect long-term relationships and profit in the process.
The statement ‘fail to prepare and prepare to fail’ epitomizes our first negotiation skill. Arrive prepared!
You might think, “I’m a Sales Professional! Of course, I’ll arrive at the negotiation prepared”. Yet, did you know preparation accounts for 90% of your sales success? 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.
- A 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! If not, you’ll appear unreliable, unprofessional and definitely won’t make a 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, having a drink available, relaxing 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, asking a question like “Are you willing to pay $X.?” Then being completely silent will compel your prospect to fill the silence. Active listening shows you’re negotiating from a solid position and that you have unwavering confidence.
This excellent and rather sneaky tactic will reinforce your statement. Ultimately persuading your prospect to start considering your offer. But, be mindful not to create awkward voids of silence – there’s nothing worse. 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. In particular, one that is free of aggression. So it’s crucial 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, giving discounts or offering concessions until you are confident your counterparts understand the value of your product.
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? Something to show your prospect why it’s worth what you’re asking? How about testimonials, case studies, and reviews? These are excellent ‘proof devices’ that prove how valuable your offering is.
8. Know when to walk away
You might find instances during sales negotiations where prospects might demand that your business can’t help, whether that involves radical amendments or colossal price reductions. It’s important to know that you have the option to walk away.
Yet, it would be best if you first tried to disengage from talks by displaying dissatisfaction. Especially with how the process is evolving. If the prospect isn’t picking up on your signals, gracefully bow out of sales negotiations. This will 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 away from the spotlight.
Think about it. Nobody wants to rush into a deal they’re not 100% happy about. So it’s imperative to slow down, take a break and check 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. So practice asking if you can receive something in return for concessions. This technique ensures that everyone leaves the negotiation in a win-win situation. Overall, a tactic which will only help your working relationship prosper.
Final word: Develop Essential Sales Negotiation Skills with SOCO Academy
Profits and closed deals aren’t the only desired outcome; preserving the relationship is also crucial to creating long-term business opportunities.
Get instant access to our in-depth business negotiations course equips participants with the knowledge and application skills to understand:
- What’s important to counterparts
- How to prepare to negotiate
- How to influence the other party
- What it takes to artfully overcome difficult situations to secure deals.