Imagine you are the Chief Operating Officer of a pet accessories manufacturer. On a typical Monday morning, you enter the factory and immediately notice a towering pile of broken dog harnesses on the floor right, right next to your factory foreman and chief engineer in the midst of a heated argument. Because conflict resolution is part of your job, you step in right away and ask for an explanation of the issue so you can negotiate with them and help create an agreeable solution. Unfortunately, your employees cannot agree on the exact cause of the problem and are caught in a rapidly failing negotiation.
The factory foreman claims that one of the clasps on the harnesses is being produced incorrectly, so it cannot fully close. Due to this defect, all of the flawed harnesses were rejected and added to a pile to be manually fixed later. This caused a number of expensive and stressful consequences, including workers being forced to put in overtime hours to deal with the faulty harnesses. The foreman felt that the problem resulted from an error in product design; therefore, he demanded that the engineering department fix the issue and cover the expenses for overtime from their budget. The chief engineer blamed a piece of machinery that had fallen into disrepair due to lack of maintenance, which is one of the duties overseen by the foreman.
What do you do? Your employees attempted to work out the problem, but they reached an impasse. Because neither party had all of the information necessary to fix the issue, they were unable to move forward and were left arguing over who should be held responsible. Rather than working together to try to fix it, they turned to blaming one another, an all too common response in the face of conflict. Casting blame was perceived as insulting their job performance, which quickly shut down all chances of reaching an agreeable solution. Thankfully, you received negotiation training from Shapiro Negotiations Institute that gave you strategies for effective problem solving both within your company and with other businesses.
You begin by acknowledging their concern and requesting that the foreman and chief engineer get to meet with you the next day to handle the situation after all information has been gathered. While investigating the problem, you uncover a minor design flaw that was responsible for product defects and get to work coming up with a fair solution that both parties could agree on. At the meeting, you negotiate an agreement with the chief engineer in which he redirects his attention from other projects to begin immediately modifying the harness design. During the negotiation, the foreman realized that the halt in production gave his team the time to fix the defective harnesses, which alleviated the issue of overtime expenses. At the end of the negotiation, the foreman and the chief engineer were able to move forward and return to their duties with the confidence that the issue was handled.
Why was this approach so successful? One word – negotiation. Just as negotiation skills form an integral part of encouraging profitable long-term relationships with other companies, they are also essential for handling internal conflicts within your business. After all, how can you expect to persuade potential business partners if you can’t maintain productivity and good relationships among your own employees? Ensuring your team understands how to handle sales negotiations means you will benefit from more closed deals, better terms that provide maximum value, and a higher return for your business.
Consider the information below to learn effective tactics for sales negotiation, then contact Shapiro Negotiation Institute today to schedule negotiation training for your team. We can teach them the fundamentals of conducting sales negotiations and help them develop their skills with an interactive program customized to the unique needs of your business.
10 Tactics for Sales Negotiation
Regardless of your industry or the specific circumstances of your sales negotiation, you can implement the following tactics to guarantee you achieve the best results with your deal.
1. Acknowledge the concern and reframe it with a positive, proactive focus.
When your negotiation partner presents a problem, always acknowledge their concern so understand you care about the matter and are committed to handling it as fairly and efficiently as possible. Rather than focusing on who is responsible for the issue or who should be punished for causing it, reframe the situation with a positive focus. Discuss the issue as a team and break it down into smaller, more manageable steps so everyone feels empowered and confident that they can contribute to solving the problem.
2. Prepare for the negotiation by conducting research.
After you acknowledge the concern and the other party knows you will handle it, the most important tactic for setting yourself up for a successful negotiation is to prepare by conducting research. You always want to enter every negotiation with as much information as possible so you can direct the negotiation in a productive direction. Familiarize yourself with the other party’s needs, interests, goals, priorities, and any constraints they face in achieving their goals. With this information, you can determine the leverage in the negotiation and create the best strategy that will influence them to develop a mutually beneficial agreement.
3. Approach the negotiation with the goal of achieving a win-win outcome.
When you enter into a negotiation with the goal of achieving a win-win outcome from the very beginning, you create a positive, collaborative foundation for deal making. Instead of acting according to your own best interests, carefully consider the interests of the other party and how you can help them accomplish their goals. This approach promotes respectful communication, encourages cooperation, allows for sharing of important information, and helps you collaboratively solve problems in a way that offers value to both parties. Not only do you reach a better outcome, but you also develop credibility that builds a framework for future business interactions.
4. Probe during the negotiation by actively listening and asking open-ended questions.
Use what you learned during your research to probe for more information when you reach the negotiating table so you can be sure you understand the full context of the deal and all of the details. Listen actively by making eye contact and avoiding distractions, then ask open-ended questions that provide the opportunity to learn more. Rephasing their statements in your own words allows them to identify any miscommunications or offer further clarification on important issues. Often, the other party will inadvertently disclose valuable information that can strengthen your bargaining power. Remember to pay attention to body language, too, as it reveals just as much as the words they speak.
5. Treat all negotiating partners with empathy.
Similar to other social interactions, effective communication during sales negotiations requires treating others with empathy. Demonstrating that you understand their perspective and value their concerns signals your willingness to cooperate, instills trust, and reassures them of your integrity as a negotiation partner. As they open up and offer more information, you can become aware of any negative attitudes or other factors that may hinder a successful outcome, then modify your strategy to use what you learn to your advantage. Be aware of your assumptions and any cognitive biases that can impact your decision-making, so they do not interfere with the negotiation process.
6. Build confidence in your team and eliminate their anxieties surrounding the problem.
If you are confident in your negotiation abilities, you can instill confidence in your negotiation partners and eliminate any anxieties they may have concerning your abilities, your company’s reputation, or the quality of the deal at hand. Instead of presenting everyone with the same standard sales pitch, consider the specific needs of your negotiation party and adjust your strategy accordingly to most effectively persuade them that your business can meet these needs in ways the competition cannot.
7. Reinterpret demands as opportunities for constructive, collaborative problem-solving.
Making demands is a crucial part of the negotiation process, but you can choose to reinterpret these demands as opportunities rather than obstacles. Rather than assuming a “take it or leave it” stance, approach both your demands and those of the other party with an open mind. Establish common ground, demonstrate your dedication to a win-win outcome, and advocate for working together to find creative solutions to problems that hinder the negotiation. No one wants to continue a negotiation when they feel pressured, so make sure you frame your demands as needs or priorities instead of ultimatums.
8. Address the problem, not the person.
Even the most successful negotiations will eventually encounter issues, but the way you handle these issues impacts the other party’s perception of you and their willingness to work with you in the future. Every negotiation should be entered under the assumption that the other party is your partner in the deal, not your opponent. When a problem arises, tackle it as a team and refrain from criticizing the other party or trying to undermine their decisions. Not only is this bad negotiating, but it can also have serious repercussions on your reputation.
9. Evaluate your wins and losses, so you are better prepared to handle future problems.
At the end of the negotiation, evaluate your performance and use it as a learning opportunity to identify your weaknesses and improve your skillset. By monitoring your sales negotiation successes (and failures), you can strengthen your strategy, become more flexible in implementing it, and increase your chances of victory in the future. When the deal is done, ask yourself these questions:
- Did the deal fully meet the needs of all parties?
- Was the other party satisfied that the deal provided value?
- What could I have done differently to gain more bargaining power?
- How can I be a more attentive listener in the future?
- Did I take enough time to hear the other party’s concerns and resolve them?
- How well did we explore alternatives?
- Did I encourage a long-term business relationship?
10. Schedule negotiation training to boost the sales negotiation skills of your team.
Negotiation training can help your employees become better negotiators by instructing them on these tactics and giving them the opportunity to practice what they learn in a safe, supportive environment. Training can help your employees learn how to conduct themselves during negotiations with clients, as well as giving them the tools to better communicate with one another, solve problems, and resolve conflict.
Contact Us Today to Improve Your Business
If you are interested in learning more tactics for effective sales negotiation, contact Shapiro Negotiations Institute today. Our negotiation training program teaches your team valuable skills they can utilize in any negotiation to deliver the best results for your business. Expert instructors provide superior education and simulate real-world negotiations so your team can hone their skills and be better prepared to effectively manage their next deal. Contact Shapiro Negotiations Institute to schedule sales negotiation training by submitting the form on our website. We offer extensive knowledge and decades of experience to improve your team’s negotiation skills and ensure they can achieve the optimal outcome in any negotiation.