Whether or not your small business sells directly to consumers, negotiating is part of being an entrepreneur. One thing entrepreneurs tell us often is that they want to brush up on their negotiation skills and tactics – so here are 7 of the factors that make a competent negotiator.
1) Planning skills
Negotiating a sale means being preparation – as much as possible. Being prepared before you enter negotiations will help you strengthen your position and give you knowledge, plans, and alternatives you can use at a moment’s notice. Here are some ways you can plan:
- Understand the needs and wants of the company you’re negotiating with.
- Know the deliverables you can produce and why they’re great.
- Prioritize your own needs and wants.
- Decide on the lowest possible deal you’re willing to accept.
2) Organizational skills
How confident would you be in a potential business partner or supplier if they showed up to a meeting late, or didn’t have anything prepared? Probably not very confident at all. Strong organizational skills give you a strong foundation in negotiation and make you look like someone worth doing business with!
3) Communication skills
You don’t have to be the world’s best public speaker, but a certain amount of comfort with it is important for small business negotiations. You should be able to speak confidently about your business, your products or services, and why you feel you’d be a good fit with your potential client or investor. You also must be prepared to answer relevant questions to the negotiation, like financial or sales questions.
4) Product knowledge
Knowing what you’re selling will show your potential client or investor that you’re knowledgeable and confident – and it’ll make your product or service sound appealing, too! You need a clear understanding of the deliverables and the value your product or service will bring to them.
5) Personal integrity
Even if you don’t make this sale, your reputation is on the line. Product knowledge is critical, but so are your attitude and behaviours. You’re trying to form a business relationship, so make it as easy as possible for potential clients to want to work with you. Listen carefully, be patient, and don’t forget to have a little fun!
6) Ability to think clearly under stress
Negotiating can be tough and frustrating – but it’s part of business. A cool head will help you adapt to changing situations and answer questions on the fly. Keep an open mind, remain down-to-earth and objective, and be willing to compromise if necessary.
7) Ability to perceive and exploit power
This last negotiation skill isn’t quite as cutthroat as it sounds. Basically, you should be able to strike a balance between getting what you want and giving away the farm. When negotiating, don’t give information away without getting something in return. Reciprocate with additional questions after providing a response. Use your instincts and intuition to read the room. Should you walk away, or do both parties have a chance at getting something out of the deal?
Do you have any negotiation tips or tricks you’d like to share? Let us know!