Essential Negotiation Tips for Small Business Owners and Entrepreneurs
Knowing how to negotiate is an essential skill that will help you get what you want in life, both professionally and personally.
Whether you’re bargaining with a street vendor or trying to close a lucrative deal, the art of negotiating is like any other skill — practice makes perfect.
So, if you want to make sure you’re prepared for the next round of negotiations, read on to learn some basic negotiating tips that you can use the next time you find yourself at the bargaining table.
The first step in any negotiation is research
The first step to conquering the fear of negotiating is doing some prep work.
You should never walk into a meeting without thorough background knowledge about the company and its major players. Here are some specifics you can look for when conducting preliminary research:
- Review the company’s page on LinkedIn
- Check out the company’s other social media channels, like Twitter and Facebook
- Read through their website (pay special attention to any recent news and announcements)
- Subscribe to the company’s email newsletter
- Track down quarterly and annual reports, if they’re available
Quarterly and annual reports can be particularly useful, because they provide insight into how much the company might be willing – or able – to invest in your services.
When you enter the bargaining process, being fully educated will make it much easier to successfully navigate a tricky negotiation.
The next step? Developing a negotiation plan
Never walk into a negotiation without a plan if you can avoid it.
Your plan should include both the highest and lowest demands. While it’s important to know what your ideal result looks like, you should also have a “deal breaker” number in mind. If the company comes back with this low figure, it’s time to walk away.
While you’re at it, don’t forget to think about where the negotiations will take place, too.
Now it’s time to ask for what you want (while also being prepared to make concessions)
When negotiating, be ready to state your demands (which should be simple enough, since you have a plan!).
Then, be prepared to bargain for what you want.
Ideally, the request alone will be enough to reach your ideal outcome. Realistically, however, concessions will have to be made on both sides.
Concessions can take on many forms, like free banner ads on a website or even an additional service for free.
Don’t hesitate to think outside the box to win your negotiation, either.
Sometimes a little bit of creative thinking is needed to reach an agreement that works for both parties. Just be sure not to stray too far from your original plan and its goals.
Get everything in writing — no exceptions
Once the details have been hashed out, the parties should agree on the overall agreement and its outcomes. It can be tempting to come to a gentleman’s agreement,” especially if you already have a relationship established with the other party.
A verbal agreement isn’t enough, though. After the negotiations are over, it’s time to get everything in writing.
Sometimes, all that’s needed is a simple written agreement that all parties sign. You might also have a standard contract or client agreement ready to go, depending on the type of deal you’re making.
When it comes to negotiating business deals, never stop practicing
No matter what type of business you run, the art of negotiating is a much-needed skill that will help your company prosper. When you make a commitment to honing your negotiation skills, the entire process becomes far less stressful.