Negotiate Your Way to a Bigger Business

Advertising, social media and expansion plans are all great ways to grow your business, but one piece of business advice that often goes overlooked is that your company cannot reach its full potential if you don’t know how to strike a great deal. Negotiations don’t always take place in huge board rooms. They can take place over the phone, through email, or even in an employee’s cubicle.  Not only does striking a good deal infuse the negotiators with confidence, it can also assist in growing a business by building good faith and productive relationships with suppliers, employees and clients.

One of the most important things to remember is that most of the work to become a great negotiator takes place before you’re even talking to anyone.  By building good faith and performing due diligence, you’ve already won over half the battle. Keep the following tips in mind:

Due Diligence:

Proper due diligence can cover many elements that may vary based on what is being negotiated. Examples are:

  • Your target price or walkaway terms
  • What the other side likely wants from negotiations
  • Concessions you may be willing to make
  • Penetrating questions to ensure information is shared

Knowledge is power and by understanding the above, not only have you prepared yourself for negotiation, but you have also learned a lot about the individual with whom you are negotiating.

Good Faith

Negotiations aren’t just one person “getting over” on the other. Both parties need to get as close to what they want for a negotiation to be considered successful.  To help ensure this happens, keep the following tips in mind:

  • Whenever possible, build a relationship with the decision maker before-hand to build good faith and assist with due diligence.
  • Offer support before negotiations. A decision maker is much more likely to say yes to someone who has proven to have everyone’s best interests at heart.
  • Turn on the charm. Don’t overdo it, but if you’ve taken the above steps, adding a bit of personality can only help get you what you’re looking for.

So you’ve done the behind the scenes work. Now it’s time to grow your business by striking a great deal. So now you’re on the phone, in your office or at your employee’s desk and it’s time to get what you want.  Keep these tips in mind:

  • Honest back and forth. This will allow both parties to feel like they are equally involved and that will help facilitate a solid deal for both parties.
  • If asked to make a concession, ask that the other side makes one, too. This will keep the playing field even and help to ensure you are getting closer to what you want.
  • If it is beneficial, have associates on your side at the table. This will allow you to feel empowered and help to ensure all issues are discussed.
  • Ask for more than you expect to get. This will help you get closer to your target as concessions invariably arise. Aiming a bit higher can be the difference between a direct hit and a complete miss.

Now you’ve struck the deal! Even if the conversation doesn’t directly result your business taking off skyward, you have indeed planted the seeds for growth. You have represented yourself as a fair person, you have proven you can communicate effectively, and you have a skill that is likely severely lacking for many of your competitors.

Remember, running a business successfully does not need to be complicated.  Keep it simple!

For more information on business analysis, business planning, and methods to grow your small business profitably, please check out our website.

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