In sales, you will never make more money per hour than when you’re negotiating. Let’s say your buyer is offering $10,000.
After some back and forth, you get him to $11,000. It took you 20 minutes. That works out to $3,000 an hour. (For your commission, do the math.) Not a bad day’s work.
You can’t do it for every sale, of course. But if you approach every sale with a negotiating mindset, you will increase your sales numbers over time. Here are four negotiation habits to cultivate:
1. Start on Day One
Savvy sales professionals know that the tone they set in the early stages of a sales campaign will often determine what happens later. That’s why they always ask for something in return when a prospect makes a request. “You want to speak with a customer using my product? Terrific. I really need to have a brief chat with your COO. Let’s arrange both of those calls.”
At times, you have little leverage, especially early in a customer relationship. But winners try anyway. At the very least, they are starting to create a relationship based on equal standing.
2. Demonstrate high value
Your scope for negotiating a more profitable deal is the difference between the price and the perceived value. The key is to get your perceived value higher without adding to your costs.
For example, one customer may place a high value on reliable service. Another may value the prestige of your brand. Yet another may place a high value on the your knowledge of the industry or their company.
None of these value enhancers add to your costs. But if you know what the buyer values and can deliver it better than others, you can command a higher price. One winner explains: “Once I prove my value to my prospects and they trust that I will deliver, they certainly don’t want to overpay for my offering, but they don’t want me to lose either. We’ve developed an interdependent relationship, and for them to be successful they know I have to maintain my margins.”
3. Discuss sacred cows
Sacred cows are terms and conditions that are immune from negotiation. Discuss your sacred cows with your buyer early, before formal negotiations begin (remember, you are always negotiating). For example, some software companies have a strict policy that maintenance fees are never discounted.
You need to explain logical business reasons behind your sacred cows, and convey the message that these items will not be up for discussion later on. Additionally, you’ll need to know what’s critically important to your prospect. If you go into a negotiation depending on winning a point that is one of their sacred cows, you could very well be headed for a deadlock.
4. Be willing to walk away
The second worst thing you can do is walk into a negotiation without knowing what your walk-away point is. The worst thing is to know what it is and to permit your customer to negotiate you past it. The confidence and determination you exhibit when you know you can and will walk away sends a loud message to the other person.
Sometimes – not always – you’ll get called back when you walk away. The buyer may have been bluffing, has a change of heart, or gets overruled. But you can’t count on the callback. Before you begin, be 100% sure that you can live with your walk-away point. To convince your buyer that you’re serious, you need to be serious.
Based on “How Winners Sell: 21 Proven Strategies to Outsell Your Competition & Win the Big Sale,” by Dave Stein. Published by Bard Press.
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