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How to Negotiate Like a Pro

Tuesday, August 07, 2012   By Mike Reddy

 

For some people, negotiating comes as second nature. The rest of us need to carefully study and learn negotiation strategies to be sure we don't end up on the losing end of business deals.

Business is about relationships, so the art of skilful negotiation is an asset to any business.

Start with the basics. Whenever negotiating make sure you are talking to the decision maker. There is nothing more frustrating that completing a lengthy negotiation just to be told that they have to run it by someone else!

Research the other party to evaluate more fully what it is they want. Research your competitors, their strengths and weaknesses, in order to stay ahead of the game. The internet is a great source of information or you can subscribe to existing industry reports that could provide real insights into the challenges the other party is facing and make you appear to be a real guru!

Establish your own objectives and parameters before you start. Know the terms that you absolutely cannot live without. Anticipate what the other side is likely to bring to the table. Ensure you bring your facts and figures with you but only present them in order to move matters forward.

Before the negotiation starts ensure you have decided on your "compromise point." It is your ace card. Don't play the card until you have to. And the longer you hold it, the more satisfied the other party will be when you offer it. They will feel they have won something (which of course they have).

Be prepared to answer the question "What's in it for me?" from the other party's perspective. Remember most people are concerned with how a negotiated outcome will benefit them. Depending on the stake, patience can be a real virtue in negotiations.

But it's also important to know your "'cut and run point." Always know your bottom line and always be prepared to walk away. Don't carry on the chase for the chase' sake. The ultimate outcome of any successful negotiation is a win-win. Something of little cost or effort on your side may prove to be of exceptional value to the other side. Always focus on creating opportunities.

Most importantly, stick to your beliefs. Never undersell your value. As any three year old negotiating with their parent will tell you: "NO is a decision to be changed."


Mike Reddy is a Chartered Accountant, business coach and advisor helping businesses in Sydney, Melbourne, Brisbane and Gold Coast to easily increase their profits and cash flow. He is currently President of the North Sydney Chamber of Commerce, a Regional Councillor for Sydney North East and a member of the Institute of Chartered Accountants Sydney leadership team. As well as advising businesses, Mike presents business development seminars and webinars and is regularly contacted by the media to comment on small business matters. You can connect with him on Facebook, Twitter and Google+.