Entrepreneurs know that starting a business is only one part of the equation. Sometimes you have to earn money too! Negotiations often go hand-in-hand with sales, but not all small business owners are natural-born negotiators. Here are seven of the commonly-accepted top negotiation skills for entrepreneurs:
Negotiating a sale means being prepared. Understand the needs and wants of the company you’re negotiating with. Know the deliverables you can produce and why they’re great. Prioritize. Decide on the lowest possible deal you’re willing to accept.
Ability to think clearly under stress
Negotiating can be tough and you may feel frustrated with the way things go, but don’t lose your temper or your patience! Being prepared before you enter negotiations will help you fortify your position and give you a wealth of knowledge, plans and alternatives you can use at a moment’s notice.
How confident would you be in a potential business partner or supplier if they showed up to a meeting late? Or had their notes covered in layers of Post-Its? Or spent 10 minutes scouring their smartphones for an email you asked about? Like planning, strong organizational skills do more than just give you a strong foundation in negotiation – they make you look good!
You don’t need to have a team of speechwriters on hand, but a certain amount of verbal ability is critical for small business negotiations. This means that you should be able to speak confidently about your business, your products or services and why you feel you will be a good fit with your potential client. You also must be prepared to answer questions relevant to the negotiation.
Small business owners in sales negotiations need a clear understanding of their deliverables and the value these items will bring to the client. It’s important to show your confidence in the value you’re providing and have examples of your experience ready to refer to. Know your products like the back of your hand!
Remember that, even if you don’t make this sale, your reputation is on the line. Product knowledge is critical, but so are your attitude and actions. Remember that you are also there to sell, so make your potential clients eager to do business with you, not suspicious or offended. Listen carefully to the client, be patient, and don’t forget to have a little fun!
Ability to perceive and exploit power
This last negotiation skill isn’t quite as cutthroat as it sounds. Basically, entrepreneurs who are good negotiators are able to strike that balance between getting what they want and giving away the farm. When negotiating, don’t give information away without getting something in return. Be sure to reciprocate with additional questions after providing a response. Use your instincts and intuition to suss out the situation in the room. Should you walk away, or do both parties have a chance at getting something out of the deal?
At GoForth Institute, we are firm believers in entrepreneurial education. So it will come as no surprise when we say: Negotiating is a learned skill. Practice makes perfect. Take every opportunity you can to learn about small business negotiation. If you know an entrepreneur who’s a great negotiator, ask for tips or – even better – ask to tag along!