Fuel is to cars as negotiations skills are to successful enterprises. To succeed in any business endeavor, the foreman and anyone managing the business must have strong negotiation skills. In several cases, businesses thrive not because the managers have found a lot of money but because they have learnt how to negotiate.
There will be many things that your business will need. They will come at ridiculous prices. That the prices are ridiculous does not mean the business cannot afford them. You will simply find out that the people you are dealing with are just asking for far more than they should. At inception, a few things may appear not too expensive. It is when the business has gone into those negotiations with little effort that you realize it is a costly negotiation.
What to bear in mind before and during negotiation
1. You don’t negotiate based on emotions – if entrepreneurs go into any negotiation based on how they feel then they have already pushed themselves into a trap. Serious business negotiations have little or nothing to do with emotions and emotions should never get in the way of negotiations.
2. Sentiments are not strong negotiation tools – sentiments don’t work either when you are dealing with serious people. There are those who try to bring religious, tribal or ethnic and racial sentiments into business negotiations. While this may have worked for some in a few cases, it is usually not a good thing to rely on for business negotiations.
3. Negotiation is like a tug of war – have you ever played the game before? There are two teams given a long rope and team A faces team B. both teams have equal parts of the rope on their sides and when given a signal, they start pulling. Team A starts pulling the rope to its end and team B tries to do the same. Whoever is able to pull the rope to its end wins the game. Does that strike a chord? That’s how negotiation works. You go in there to get the juicy part of the deal and the other party is coming to get the juicy part of the deal. The stronger negotiator is the one who goes home happy or is happier when returning home.
4. You don’t have to conclude immediately – Hurrying to conclude a negotiation might show some desperation and in such situations, the team an entrepreneur is negotiating with might just take advantage of that. This does not also mean you should slow things down unnecessarily. Bottom line is that you should not appear desperate, even when you need something urgently.
Be armed with the following while negotiating
1. Information – Before negotiating a deal, you should talk to some other people to know if deals like that have been struck before. Talk to lawyers who would have helped others with series of negotiations and search the internet. You can talk to some business coaches as well to get their perspective on the angle from which you intend to negotiate.
2. Facts – information is certainly different from facts. You should go a step further to get figures where applicable. Get dates if that will help. Don’t just go into negotiations without knowing what you are going to talk about or having points to negotiate with.
3. Expertise – negotiate from the point of your expertise. This certainly makes things easier for you. If you are not an expert in a field and for whatever reason your business needs to negotiate in that area, allow the experts to handle that.
4. Value proposition- What you are offering is always an important part of the negotiation. This is why you should have information and facts because they will help in determining what to offer. If your value propositions – what you are bringing to the table – seems too small, you may not get much from the negotiation.
5. The worst scenario should be a win-win – despite saying that negotiation is like a tug of war and both parties want the best from any negotiation, an entrepreneur should be bent on taking it all or always taking the best part of the deal. There should be win-win situations in negotiations. In win-win situation, nobody seems to get a better deal. Both parties are happy because they have gotten desired values from the negotiation.
Whatever the deal is that you are negotiating, your ability to communicate effectively will always be important. In the negotiation process, an entrepreneur should know when to talk and when to listen.