Negotiation skills
Negotiation skills
Negotiation skills
Negotiation skills
I suppose the alternative title for this chapter could have been “Getting your own way”.
Why on earth do some people end up with great deals (or get their way) when others don’t?
Well here are some tips you can follow:
• Be stubborn. If you have a solid negotiation stance don’t allow the other party to
ride roughshod over it. Stay firm, if it clearly makes logical sense to do so, and be
iterative in your discussion if the other party is effectively ignoring your argument.
• Turn the conversation around. Don’t let the other party lead the discussion. Make
sure that you have an agenda and follow it.
• Follow your logic not theirs. Don’t fall for what appear to be clever arguments or
tactics that don’t actually stack up in the cold light of day. Stay true to what you
believe in.
• [However] Be fair and reasonable, or expect to lose.
• If possible, reach an agreement that keeps everyone happy. If you push too far, the
other party will walk away – perhaps not now but as soon as they realize that there
is no value in the deal for them.
• Assess who has the balance of power. The more power you have the stronger your
negotiation position.
• Where appropriate make sure that you have more than one bid or tender. Even for
relatively small contracts your position will be that much more powerful if you can
demonstrate that you have alternative quotes that perhaps provide better value.
From experience, unless at least 3 quotes are obtained from reputable companies
you don’t have even an initial feel (let alone an accurate one) for market prices.
Also, let all the parties know that you are seeking competitive bids from other
businesses to help focus their minds on the overall value for money of their offering.
• Don’t be afraid to revisit the deal at any time before you sign on the dotted line. If
you feel that you haven’t done a good job on the negotiation front and realize later
that the deal won’t yield an acceptable to return for you (perhaps your planning
wasn’t a great as it should have been) then be upfront and transparent to the other
party explaining that you can’t sign until the deal hits a certain threshold in terms of
financial return.
• Good cop, bad cop. One useful technique to try, particularly where you find it
difficult in a face-to face situation to push hard on (say) price, is to leverage the fact
that your boss has set some firm financial targets for you with respect to the deal.
In other words they won’t but the goods or service for more than £X or they won’t
sell your services for less that £Y. In practice, I have found this process extremely
useful and it allows you not only to defer discussion at any given point in time by
stating that you will have to run the proposal past your boss as it does not fulfill the
requisite financial criteria, but it allows you to be seen as the person trying hard to make the deal work in what are clearly difficult circumstances. You should ensure
that you obtain your bosses’ permission to cast them in the role as ‘bad cop’, as the
tough, perhaps inflexible manager, in case they are somehow contacted directly or
otherwise uncomfortable with the approach.
• If you are unable to reach agreement during the process of negotiation here are
some ideas to consider:
o Would a longer term deal allow either party to be more flexible on price?
o Would an exclusive relationship seal the deal?
o Would the introduction of enhanced service levels better your cause (or a fall
back to more basic/standard service levels if price remains the absolute
sticking point)?
o Would a dedicated account manager provide the added ingredient to allow
you to finalize proceedings?
o Would either a discount for prompt payment or a discount for signing before
the month is out add the incentive required?
o Would the advertisement of your relationship (Public Relations exercise) make
the deal appear more interesting?
o Would future price caps be of interest?
o Would enhanced data analysis be of importance?
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