Successful business negotiation can be worth a great deal to your business. It can mean the difference between securing a contract and losing a contract, and has the potential to be worth untold amounts of money to your business. Thus, its no surprise that negotiation skills are fundamental to being successful in business. Negotiation is relevant when it comes to closing contracts on favourable terms with suppliers, but also during the sales process, and in dealing with potentially profitable clients. For the business owner looking to close more significant sales, learning the basics of negotiation is critical, and probably one of the quickest ways of being able to establish a successful business.
The first thing to understand about business negotiation is that its all about give and take. Obviously when negotiating in business you are out to get the best deal for your business. But its important to understand that these objectives are mirrored on the other side of the table, and very few shrewd businessmen will be willing to allow such one-sided negotiation. Therefore its important to distinguish between what you must achieve and what you want to achieve, thus building in some leeway for giving in to the requirements of the other side. Mutual negotiation, on a psychological level, where it may appear that there has been some form of compromise, can have a significant effect on closing sales and negotiating contracts, and can leave the other party to the negotiation feeling as though both parties have got the best deal.
When involved in business negotiation, a key skill is to listen to what the other party is trying to achieve and to try to understand their personal motivations during the negotiation process. This can help you understand more readily what the other side of the table desire, to enable you to more effectively come up with suggestions that may help the deal through. Dont fall into the trap of forcing yourself on the other side. Listen to what they have to say, and put yourself in their shoes to understand their objectives before taking things forward. Its also a good idea to be relatively cagey in terms of what you desire, and revealing this too early in the negotiation process offers a key opportunity to the other side to negotiate a bargain at your expense.
Finally, negotiation is best conducted on friendly, personal terms. Its easy to create a positive relationship with the other party prior to negotiation, simply through the way you talk and interact with them in the pre-negotiation stages. At the end of the day, negotiation in business is very much about understanding other people and their motivations and desires. People respond better to those that they feel share a good personal bond, and for the limited effort required to achieve that bond its well worth it. Negotiation in business with someone youve already spoken to and shared a positive relationship with is much easier, and much more likely to produce a mutually beneficial outcome.