How to use the sales negotiation process to make more money – Part 1
Following a well thought out sales negotiation process with a prospective client will undoubtedly increase profits. A bit like baking a cake, if you do the right thing at the right time, then your profits will rise like the lightest of sponges.
Miss out a step or two at the beginning and you will find it incredibly difficult to get the deal you and your business needs. It doesn’t matter if you are dealing with a professional buyer or not, the process is the same.
Easy peasy when you know how
Great sales people make this part of the sales process seem effortless, but trust me, anyone can do this really well too. By focusing a little bit more on following the sales negotiation process, you will find that you will be more likely to create a Win/Win for both you and your client.
The Sales Negotiation Process
In the first of this two part post, we will go through the initial 7 steps of the process. In this part of the sequence you will notice that preparation is key to success. The sales negotiation process is very similar to the whole sales process, but heavily focused on the relationship.
Put yourself in your buyers shoes – Consider what is important to them. What are they thinking? What pressures are they under? What will they consider to be a good deal? What could their negotiating variables be. The more you think about the sales negotiation process from their perspective then the better the deal for you both.
Prepare – As in every process, time invested in preparation will always pay off. Consider all your possible variables that you could use to negotiate with. Make sure you have all the information you need to hand. Consider your own tactics and strategy, bearing in mind the power sources on each side. Role play and rehearsal can make a big difference too.
Identify “Key Levels” on your “Key Variables” – Before you get involved in the actual negotiation you must determine “Rock Bottom” is on price and all your critical variables. These are the levels at which you would literally prefer not to have the business.
Plan your initial stance very carefully – You must start in the right way in order to end with the right results. It is important to take a strong initial stance, but you must be prepared to justify it in order to retain credibility. Remember your initial stance will set the tone for the rest of the negotiation.
Aim high and be confident – The higher your target the better the deal you are likely to achieve. However, you have to believe that your target is reasonable and communicate that self-belief.
[easy-tweet tweet=”Let us never negotiate out of fear. But let us never fear to negotiate – JFK” user=”SucceedatSellin” hashtags=”#sales”]
Encourage the client to reveal their initial stance and “shopping list” as early as possible – Get the “What’s your budget?” question out there to quickly find out what your clients expectations of a good deal are. Ask them what their agenda is to uncover more of the variables.
Trade concessions, but justify each one – Never give concessions to your client. Always make it is appear that it hurts. Also try to trade small concessions for large one. Don’t assume that each trade must be of equal value.
Aiming for the Win/Win result
The first seven steps can appear a little daunting for both sides to be involved in. So the easier you can make it for yourself and your client, then the more likely you will be able to achieve a Win/Win for you both. (Read this post to learn more about using your power during this phase)
Keep a smile on your face when asking for a concession, and firm when being asked to concede yourself. You have both worked hard on the relationship to get to this point in the sales negotiation process and it is important to maintain a relaxed, but focussed atmosphere.
In part two, we will be looking more into how to keep momentum during the sales negotiation process. What to do when you get the deal as well as what to do when you have to walk away.