It’s tempting to tie a bow around a deal and move on quickly to the next one. How confident are you that your negotiation team will secure the best possible outcome for both you and your prospective client?
Craig McAlpine discusses 5 key areas to consider when negotiating for sustainable business.
- Preparation and Planning Process
- Sustainable Terms
1. Skills: A skilled negotiating team will know how to read the prospective client, know when to park a contentious issue and when to continue. Save your bargaining chips and never negotiate an issue in isolation. Always make sure your negotiating team are sufficiently skilled and empowered to secure the best possible outcome, not lose it.
2. Preparation and Planning Process: 80 percent of companies have no formal negotiation process (Huthwaite). Preparation is only part of the process. Planning how you will utilise intelligence is essential. Know both sides needs, flexibility and alternative options. Throughout the negotiation be prepared to ask for more time if you need it. Your team should be equipped to make decisions with the confidence and clarity required to win the respect and trust of your prospective client.
3. Emotions: No-matter how attached you are to winning the deal, negotiating a bad deal will turn what seemed like a golden opportunity into a nightmare. You won’t win accolades from your colleagues for bringing back a lemon, and your newly won client will rapidly become your newly won burden. Emotions don’t have a place at the negotiation table.
4. Change: Be prepared for change, even at the closing stages of negotiations. Ensure the commercials leave you room to negotiate in or out. If you believe the change(s) will compromise previously agreed terms and conditions explain why, and if necessary consider walking away from that part (or all) of the deal.
5. Sustainable Terms: Your clients’ buying behaviour may evolve in such a way that agreed terms and conditions are no longer viable. Discuss with your client the impact this is having on your relationship and your desire to renegotiate sustainable terms. If this is not possible consider carefully the ramifications of remaining or exiting the relationship. If you do exit, ensure you leave the door open to renew the relationship further down the track. Remain friends.
Next Steps: Don’t blow the already significant investment you have made in the RFP process through poor negotiation skills. If you haven’t got the expertise in-house, then invest appropriately in training or external assistance. If you would like to explore sustainable business negotiation further feel free to contact me directly.