Tips for Small Business Owners: How to Negotiate
Negotiations are often likened to war, and countless Hollywood movies have made it seem like the key to negotiating is being recklessly aggressive. While aggressiveness isn’t a bad thing, in real life the best negotiations are ones where both parties feel like they accomplished something and were mutually acknowledged. Negotiating isn’t a war, it’s an art, and we’re here to help you master it.
- Set Clear Goals: The most important thing is having a very clearly defined list of goals. Prioritize these from most important to least important so you have a better idea of where you have some wiggle room and what can’t be budged on. It’s also good to have a clear bottom line, i.e. a minimum that you won’t go below no matter what.
- Research Rules: The more research and prep-work you’ve done heading in, the better. Not only should you know what you need, you should also anticipate what your opponent needs to get from the deal. The more you know about their company (past deals, current business model, etc.) the better. Look into their competitors as well; if things break down you could always hint that your business could just as easily go to a rival firm.
- Listen: Sometimes the other side may have a specific objection, but is expressing it in a generalized way. Listen carefully and try to read between the lines, you may find you can give them what they want for a lot less than they were explicitly asking for.
- Give and Take: Remember, it’s ok to give up on something lower down your list as long as you get the things that really matter. Good negotiations are a give and take. Maybe you got a slightly lower price, but a higher volume over a longer time. Take the win.
- Don’t Be Intimidated: As a small business owner, taking on the big boys can be scary. Stay calm and collected. Your research and clearly defined game plan should help with that. Stick to the plan and don’t get pushed around – you’ll earn more respect for standing your ground.