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How to Master the Negotiation Process

By Kim Dean

Mastering the negotiation process is an ongoing challenge for sales professionals. Is the negotiation process different from the sales process? Yes, selling is the act of providing value through goods, services, and information/insights to address a customer’s challenges and/or opportunities. Negotiating is the interaction that determines the terms of the transaction.

Essentially, selling creates value; negotiating gets paid for that value.

What are the obstacles that impede negotiation?

Start with a Strong Platform

In an ideal world, negotiation terms are fair and fruitful – and all parties emerge satisfied with the terms

Too often, though, the sales professional assumes the customer’s concerns and positions without truly exploring what the customer is thinking and trying to accomplish. Salespeople must remain open and listen to the initial feedback regarding the opening offer.To end well, the negotiation must begin on a positive note….creating value. A salesperson must have established that value and have aligned it to the needs of the customer.  

How can both parties interests be served?

Avoid Playing Defense

A common tactical error is to begin the process in a responsive mode, waiting for a pricing challenge and then trying to justify value. This is playing defense. Instead, start strong with the opening terms and the rationale for those terms. Start from a position of strength.

If you open with a justified price and terms based on what you bring to the transaction, all changes should be a give and take. That is true trading. Concessions, on the other hand, are one-way gives and should be the path of last resort.

Andrea Moses put it well when she said, “When your customer says that your price is too high, he means that he does not appreciate the value of your product.” Make sure both sides are speaking the same language about the product before coming to any agreements.

Closing a deal for the sake of closing is not smart negotiating. It leads to difficulty in implementing the solution – as there is no meaningful basis for the terms. No deal is a legitimate close to a situation where the parties do not agree on value. Sometimes, the first step in achieving win-win negotiations is reaching a diplomatic – yet not consummated – close.

Build Trust

Some sales professionals choose to hedge their bets at the negotiating table, opting to keep something hidden as a form of insurance policy should negotiations go south. However, if your goal is to build trust and long-term business relationships, then the phrase “negotiating in good faith” must become a personal objective.

Professional credibility is earned, not purchased, and the easiest way to forfeit all hope of establishing credibility is to not play it straight. Negotiating can be done fairly and firmly without compromising one’s integrity, and will pay dividends with business partners who share a like-minded approach.

Prioritize Your Desired Outcomes

Not all terms are equal in value to both parties. The best trade is giving something of value to your customer that is not as costly as other options. Some trades are fixed costs to your organization and can be of great worth to the customer.  

A large portion of successful negotiating can be attributed to deftly prioritizing one’s desired outcomes. While not everything on a given priority list may be attained in a negotiating session, working toward achieving the most important results should be the goal. Similarly, it is important for one side to recognize the opposition’s priorities to maintain fluidity and balance in negotiations.

If you realize both parties enter a negotiation with different and sometimes competing interests, a potential win-win can be found. Figure out quickly – before starting to trade – what their top priorities are versus their opening positions. Discuss openly so negotiating partners know the order of importance and are willing to dispense with secondary requests to reach a mutually acceptable position.

Everyone wants to emerge victorious from a negotiating session. Know what would truly constitute victory for your company. Realistically, this does not mean getting everything you propose. Long-term victories require both parties to win what they really need.

At Richardson, we help sales professionals master win-win negotiations and achieve great results for both sides of the conversation. Learn more about Richardson’s negotiation training program or follow us on Twitter.

Kim Dean is senior training consultant at Richardson Sales Training. Kim facilitates highly interactive training workshops for sales and sales management professionals in a variety of industries.

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Managing Sales Team Talent: How to Help Reps at Any Level Sell More

By Nancy Martini

One of the most difficult challenges any manager faces is helping an employee improve performance. Creating a high performance sales team is even more complex. A typical sales team includes a number of top producers (10-20% of the team); these are the folks who crank out the numbers month after month — either with incredible skills, sheer effort, or a combination of brains and brawn. The middle group (60-80%); often includes reps who are adequate but not yet reaching their potential — various reasons get in the way, from confidence, to commitment, to limited skills or motivation. Finally, there is the small group (10-20%) of those struggling with the position and trying to figure it all out — they may or may not make it. Ultimately it’s up to the sales manager to drive the performance of the entire team, fortunately (as I discuss in my new book) science can help determine the exact scenario and who needs what.

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As a manager it’s important to look first at the relationship between the reps’ sales skills and their actual sales results. There are four science-based scenarios that occur to help diagnose and guide you for accurate coaching.

The “Muscle” Scenario: High sales results, Low sales skills.
These are top producers who get the job done, but likely in their own way. Their success may come from years of experience, superb product knowledge, or they’re simply extremely hard workers. The good news is, they get superior results. The bad news is how they do it. A rep with high sales and low skills tends to be highly reliant on a single muscle (for example closing skills, presentation skills or questioning skills). They are most likely working inefficiently. By building other muscles, they could potentially increase their performance and efficiency substantially. Most top producers are all over increasing skills that can help create more sales; managers tend to shy away with a fear of messing with success. Gather the sales skills assessment data and dive in; this effort is well worth the return.

The Execution Scenario: Low sales results, High sales skills
These are the folks who know what to do but have trouble executing on that knowledge. They’ve attended the sales training, they even get it, but they just have a block getting it done. We all know the old adage “the knowing-doing gap” and this the classic issue in this scenario. It may be from lack of confidence, lack of drive, or simply lack of coaching but this rep needs help with the “doing.” In this scenario, a focus one-on-one coaching is ideal. The rep gets to see how his or her judgment and knowledge plays out live with feedback from a skilled coach. When a person has the sales skills assessment needed for the role, it’s also helpful to examine their behavioral assessment to uncover the drive behind their selling.

The Knowledge Scenario: Low sales results, Low sales skills
Your sales reps who score low on the sales skills assessment and have low sales results need one thing — training.  You can hire the best reps in the world, with all the drive necessary to succeed, but if they don’t have core sales skills, they become a rocket without a direction. This one is fairly easy to adjust: start with solid sales training and reinforce with focused skill builders. By increasing a rep’s core sales skills, you are giving them the tools necessary for the role. These reps tend to be sponges and the sales skills training is absorbed and used.

The Leverage Scenario: High sales results, High sales skills
This one is the most complex of all. A terrific rep who emulates all the sales skills you want and creates outstanding sales results. Good as it is, you have two risks to stay on top of: 1) the rep may plateau because of time constraints; and/or, even worse: 2) he/she gets bored when “been there, done that” kicks in. In either case, your top producers need to be kept engaged, challenged, and leveraged. The leverage approach suggests that you examine all aspects of the person’s role to remove obstacles and increase support to give them as much selling time as possible. It may be additional technology or it may be a part time assistant but ultimately your goal is to leverage this talent with more time to sell.

In each of the four scenarios sales analytics help remove the guesswork and provide you with laser sharp focus of what’s needed. Pay attention to the sales skills assessment scores, the behavioral assessment profile, and the reps’ actual sales results — those three data points provide the accurate insight needed to impact the sales performance of every member of your team.

Nancy Martini
Nancy Martini is President & CEO of PI Worldwide, publishers of the Predictive Index (PI) and Selling Skills Assessment Tool (SSAT). She is the author of the newly released Scientific Selling. In October she will present Sales Coaching 2.0: How Using Scientific Data Leads to Better Sales Performance as a keynote  speaker at the Sales & Marketing 2.0 Conference in San Francisco.