Deals are rarely straightforward. When negotiating business deals and contracts, understanding the art of negotiation helps you achieve the best possible outcomes for your organization or company. Every negotiation involves nuance, but following a few fundamental principles empowers you to take every step to build momentum and secure a victory.
This article from United Consumer Financial Services explores strategies for navigating difficult negotiations and closing deals. Let’s get started.
Cultivate Empathy for the Other Party
Even though you negotiate contractually with an organization or company, you will talk numbers with a person. Every good negotiator must understand and cater to the human element of the deal.
Listen to what the other side communicates. Understand their hesitations or concerns, then take time to respond thoughtfully. Understand what’s important to them, their financial or time limitations, and where they have wiggle room. Cultivate empathy so you can guide the conversation to meet their needs without compromising the essentials of the deal.
Do Your Research
Knowledge is power at the negotiation table. Before you enter a meeting or negotiation discussion, conduct your research. You should have exhaustive knowledge of
- The business represented by the other party, including their unique pain points and how what you’re offering is the best solution to their needs
- The individual(s) you’ll be negotiating with, their history with the organization, previous deals they’ve arranged, and the perspective and history they’re bringing to the table
- Other offers they’re entertaining, including pricing and terms, and the organization’s relationship to your competition
The more you know before entering more specific negotiations, the better prepared you’ll be to proactively address concerns, answer questions, and present your deal as the most complete and valuable solution.
Keep Cool
Emotions can run high when negotiations are complex, or one (or both) party has a lot riding on the deal. Because negotiations in nearly any space bring out the passion in the negotiators, you must keep your cool and stay calm.
Maintaining composure and professionalism is likely an obvious factor in successful business deals. However, even the most even-keeled individuals can get caught up in their emotions when money is on the line.
Keep the negotiation professional and courteous regardless of the other party’s behavior or demeanor. Proving your product or company’s value is not more important than professionalism and respect. Even if a particular deal falls through, you may have other chances to conduct business with the same person or organization.
Don’t burn bridges during high-stakes negotiations. Keep your cool; it’s not just your reputation on the line. You’re representing your business and influencing potential future deals.
Know the Dynamics of the Negotiation
Every party in a business negotiation brings various dynamics to the conversation. Understanding the deal dynamics is essential to securing the sale.
Before negotiations begin, determine the following:
- Who has the power at the table? Who wants or needs the deal more?
- What are the time and financial constraints of the other party?
- Is your offer the only option? What are their alternatives?
The scales will rarely be balanced in these conversations. Understanding your place within the dynamics of the deal will help you know where to push, where to back off, and how to get the results you want.
Prepare a Written Draft of the Deal
In most business deals, both parties sign a contract or document noting the terms of the agreement. As you enter a negotiation, prepare a first draft of the deal. This proactive approach lets you structure the contract according to your desires, including points you want to discuss.
Your draft should appeal to the other party while positioning you with the momentum you need to close the deal. A balanced draft agreement ensures you start on good terms. If you do your research and create a draft contract that serves the other side, they’re less likely to make extreme edits that diminish the value of the transaction.
Walk Away if Necessary
Seasoned negotiators know that every deal won’t happen, and sometimes it’s best to walk away. Before you go in, you must know the lowest number you’ll accept before choosing to cease negotiations.
At a certain point, the deal isn’t worth it. How many resources are you or your organization pouring into negotiations, and at what point have you crossed the threshold for returning value with this deal?
Walk away when it’s time. There will be other opportunities to close a deal that reflects your product’s or organization’s worth.
Keep Negotiation Timelines Short
Regardless of the nature of the deal, you’ll want to negotiate and come to an agreement as quickly as possible. The more time spent in negotiations, the more likely an issue will arise that can derail your efforts to secure the sale.
Prompt communication increases sales. Review, edit, and send documentation quickly; do whatever it takes to continue negotiations and maintain momentum toward closing the deal.
Increase Buying Power
If you’re in the selling position, you want to equip the client with as much buying power as possible. In some cases, providing financing options is a viable method to ensure the other party has the means to confidently commit to your proposition.
Consumer financing allows buyers to say yes, increasing their purchase power without disrupting their budgets. Financing reduces friction in the negotiation process, helping you and the potential buyer focus on the deal without the distraction of tight budgets and finance constraints.
United Consumer Financial Services provides financing services backed by decades of experience. Our team anticipates your needs and provides your clients with the resources and support they need to make confident, on-time payments at rates they can afford.
Providing clients and customers with affordable payment options increases their buying power and increases the likelihood that you’ll close the deal.
Strategic Negotiation that Gets Results
Navigating complex negotiations requires skill, strategy, and practice. But with the right techniques and resources, you can present your proposal and close the deal. Implementing the above strategies strengthens your negotiating power and positions you to win.
When you’re ready to establish a robust financing program for your business, reach out to the United Consumer Financial Services team. Our consumer financing options can increase your negotiating power and provide valuable services to your clients starting today.