As an entrepreneur in the competitive business environment, you are expected to get the very best out of every deal and transaction. You have to prioritize your business interests and ensure that the deals you enter are suitable for the overall success of your organization. This isn’t selfish behavior, but just how we have been molded by nature.
However, a good negotiator does not prioritize their own needs but one who objectively looks at things. Most deals blow up because entrepreneurs are so hell-bent on serving themselves and their organizations that they forget to consider the cumulative good offered by the agreement objectively.
Negotiating is not an easy process and is one of the more challenging parts of running a business for women entrepreneurs. You need to strike the right balance and ensure consistency in what you offer for effective results. Successful negotiators aren’t shaped overnight. Instead, they take time to master their negotiating skills and practice the expected approach.
In this article, we look at some simple yet effective steps of negotiation that entrepreneurs should work on for successful negotiations. Go through this article and improve your negotiation skills for the better.
Focus on Planning Skills
All successful negotiations are usually the result of hours spent preparing and planning. This means that entrepreneurs should put in the required hours within their research and study the needs and behavior of the other party before they eventually sit at the table together to formulate a deal.
Knowing the nature of the negotiating party and their behavior during negotiations can help you devise a strategy that will take you through the process. You cannot successfully negotiate with people you don’t know. Hence, you must do your research and know your partnering negotiators first before taking the step forward.
Understand the Importance of the Opening Offer
In most cases, the opening offer is the vital bit of information that anchors the entire negotiation process. It holds a lot of essential details, regardless of who took the lead to place their offer. Therefore, the opening offer needs to be looked at with careful consideration. Opening offers aren’t just limited to the full quote. Still, they include the work proposal, the goods or services that will be used within the process, the warranties to be offered, incentives, terms and conditions, and the price.
Popular culture suggests that you shouldn’t be the one giving an opening offer in any negotiation. However, suppose you’ve done your research and understand the recommendations being circulated in the industry. In that case, there is no harm in making an opening offer and setting the flow of the negotiation process.
Also, before you set the opening offer, make sure that you have a clear bottom line in mind which you would be willing to accept. This bottom line shouldn’t be compromised during the meeting at any cost.
While it is good to do your background research and feel confident in the quality of the offer you’re putting in, entrepreneurs should try to leave their ego out of the negotiating room. Lack of emotional control and toxic bouts of confidence is a recipe for failure in negotiations. When negotiating your way through an offer, you should be as neutral as you possibly can. Do not let your emotions and your thoughts get the better of your decision-making abilities. Most deals are lost or closed because of the inability of concerned members to think outside of their emotions and reach favorable conclusions.
“The most difficult thing in any negotiation, almost, is making sure that you strip it of the emotion and deal with the facts. And there was a considerable challenge to that here and understandably so.”
– Howard Baker
Be Prepared to Walk Away
Always be prepared to walk away if the negotiation process does not go in your favor and when the other party isn’t showing the flexibility you expected from them. Regardless of how vital a negotiation process is or how tempting it can be to get the deal over within one meeting, entrepreneurs should always be prepared to walk away.
The ability to walk away if things don’t go the way you want almost always puts you in a position of power. You will never be bulled if you’re willing to leave the meeting with disapproval. Problems come up when entrepreneurs start to believe that this deal is everything to them. Such behavior can lead you to accept mediocre offers.
Ask Good Questions
Do not assume anything related to the deal and ask good questions. The chances are that a deal might sound good to you on paper but may not be as good when you start asking questions and consider all other relevant details. Your questions shouldn’t just be a means to acquire knowledge but should also be a means for you to hit the jackpot and get the results you require. Make progress with your questions and push the other party to the outcomes you need through the power of questions.
Effective listening is an essential requirement for negotiating successfully. You should be able to catch all details relevant to the deal and mentally process them through the events. Effective listening will also help you see minor glitches that might otherwise go unnoticed. Your listening skills will be at their best if you leave your emotions at home and are willing to think objectively.
Negotiation is an essential process for entrepreneurs today and can help them make strategic business decisions. Entrepreneurs should always negotiate with the appropriate gatekeeper or person in charge to avoid wastage of time.