Unlocking Yes - Revised Edition

Sales Negotiation Lessons & Strategy

Patrick Tinney

• Publisher: Centroid Publishing
• Year: 2018
• eBook ISBN: 9780993828461
• Edition: 1
• Topic: Business
• Subtopic: Business generale
• Index: Business

Sales negotiation is eternally and constructively tied to consultative selling. So, we must always be very mindful of the power and strength of long-term, trusted, businesses relationships. Armor-piercing questions in their various forms must not be seen as anything other than a positive risk tool used to clarify our bargaining position and that of our negotiation partner.

Our personal brand and bargaining table image is nothing more than our personal set of perfectly repeatable promises at work. How we frame negotiations. How we prepare negotiations. How we conduct and manage stratagems.

After reading Unlocking Yes you willunderstand, sales negotiationis a craft comprised of philosophy, theory, and art. Sales negotiation on the ground and at the bargaining table is a game of elasticity. It is a plethora of plans and back-up plans (BATNA)* that lead you into a profitable bargaining continuum.

Preparation cannot be understated. To be a truly great sales negotiator, you must be able to digest all known facts about any negotiation well enough to un-script in the heat of a bargaining exchange to elevate your cause and claim greater value. Your knowledge of strategyand your ability to shift strategy in the blink of an eye makes you a force to be reckoned with.

Remember, the world of sales negotiationis a fluid environment. You must continue to add new tools to your negotiation repertoire. Read, practice, and implement bravely.

Be creative. Offer great value. Make friends. Be true to yourself.

*Best Alternative to a Negotiated Agreement

PART I – PHILOSOPHY

1

TODAY’S ECONOMY AND THE NEGOTIATION MARATHON

We are ten years into the Great Recession, and sales negotiation has never been tougher.

Today, we stand with nearly unprecedented consumer debt in North America. The U.S.A. is still bouncing in and out of recession-like economic conditions. It is estimated that there is as much as $1.3 trillion dollars of unspent capital expenditure budgets lying dormant on North American corporate balance sheets. Corporations want to make money but, do not want to spend money. Some businesses have resorted to shrinking the size of their operations to fit their declining revenues. Topline sales growth is still a guessing game for many companies, especially retailers.

Lenders are still cautious about who can borrow and how much bankers will lend. Truly, a whole slew of ill-timed economic chickens coming to roost all at the same time.

There are signs of economic improvement. But, it’s masked by the trillions of dollars of government liquidity and quantitative easing that has been injected into financial systems around the world.

Business contract negotiations have been extremely challenging with too many sellers chasing too few buyers. This indicates we are in the clutches of a buyers’ market, and the buyers know they have the upper hand. Rather than being an annual affair, it seems customers of all stripes want to negotiate everything on a weekly basis. So what is your company doing to grow your topline sales and protect precious margins in this negotiation marathon?

We are all short of time; it doesn’t matter whether we are selling or buying. With global business running 24 hours a day, greater demands on all business people and the impact of technology (both good and bad), time is truly compressed. Vendors need to sell more, while buyers take more time to research, consider and decide on their best options. As such, time compression reveals a fairly noticeable drop in civility. With so little time and so many changes in our current marketplace, we need to raise our game or have a competitor eat our breakfast.

Throw your own spin on your company’s competitive and economic realities and now you really get the picture.

Here are a few things that I would really like you to key in on.

1)Learn the value of asking the best questions possible. This will save you time and turn ordinary customer engagements into power calls.

2)All of us are in the relationship business. Relationships are the tipping point for business stability, sales growth and negotiation profitability. Customer relationships are critical.

3)Collect customer intelligence on a weekly basis and especially before a negotiation begins. Do this through casual conversations and regular meetings and not necessarily pertaining to the negotiation. In other words, get the other side to talk about their world – their company goals, growth expectations or competitive challenges.

4)The above will allow your side to do a mini SWOT Analysis (Strengths, Weaknesses, Opportunities and Threats) on the other side and their and your competitors.

5)Be creative. Customers want creative ideas, not stuff. Stuff gets negotiated as a commodity. Beware.

6)Think strategy. Too many in sales want to jump into negotiations without a game plan and the results are not always what they had hoped for. Try to grow your understanding of strategy mixed with crafty tactics that will give you flexibility under pressure.

7)Understand the importance of BATNA (Best Alternative To A Negotiated Agreement). A BATNA is a stream of plans and back up plans.

8)Learn and understand the power of handling concerns and objections under pressure. This is a magnificent skill and one that will turn negativity into surprisingly quick customer driven closes.

9)Close smart deals. Think about all of your negotiations as having the basis for potential longevity.

10)Finally, be critical of your own work. Tear apart every deal you complete and look for improvement. Sales negotiation is a process but, it is also an art form.

Even with all of this groundwork, you are just at the entry point (believe it, or not), where you can start asking probing, armor piercing questions of the other side that will build your case in preparation for the negotiating marathon.

2

WHY CONSULTATIVE SELLING INTEGRATES WITH NEGOTIATION PLANNING

Sellers are always looking for more effective ways to grow relationships with their important customers. Gone are the days when a salesperson could just pick up the phone and get a quick appointment.

Increasingly, customers are barricading themselves behind gatekeepers and virtual e-mail walls. Customers are only inviting into their inner circle suppliers with whom they have a history or in whom they see great potential. On this note, consultative selling is essential for sellers who have to be close to their customers. Consultative selling in this context is trust and collaborative-based selling to key clients.

Consultative selling helps to maintain margins through perceived and real demand for a seller’s products. This is accomplished with an intimate understanding of the customer’s business and category.

Consultative selling integrates effectively with negotiation planning in the following ways.

1)Customers want creative ideas & solutions

Suppliers who offer ideas that either save the customer money or potentially grow sales will be invited to the negotiation party. A salesperson who consistently brings creative ideas/solutions to their customer’s attention will be first in line.

With consultative selling, the salesperson who is thinking creatively and on-his/her-feet, understands and anticipates the customer’s appetite for risk. As a result, a consultative salesperson will have greater access to direct customer conversations that convert into revenue opportunities.

It is important to note that your customers want to shine in front of their peers and their company superiors. If a customer has a germ of an idea and wants to collaborate with a key supplier in search of a finished solution, salespeople who are creative and consultative will be contacted more frequently.

2)Customers and trust

Trust between two people is very personal. Consultative salespeople strive to hone and improve their trusted relationships with key customers. The importance of trust between a salesperson and the customer cannot be underestimated.

A former Director of Media Procurement for The Hudson’s Bay Company once told me that trust was what separated the people who won deals with him versus those who didn’t. He indicated that on a weekly basis, many proposals were forwarded to him, all with compelling offers and value equations. When it came down to choosing which deals to accept, he always asked himself which salespeople he trusted most. These were the salespeople who won the deals and are the people he relied on to execute professionally.

3)Consultative salespeople move up the food chain

As a salesperson, if you are not in the first or second call position with your important customers, selling will likely be more expensive. Consultative salespeople understand that if they are in the third or lower call position that they will be forced to sell and negotiate at deeper prices. This means these third and lower position salespeople are at greater risk of having their products commoditized by the customer. It also forces these same salespeople to buy market share to stay at the table with important customers.

4)Selling one of anything is just plain expensive

With the rising “cost of sale”, why would sales management go to the expense of selling just one of anything to a customer?

Consultative selling encourages both buyers and sellers to look for more common ground because everyone benefits when both parties realize that a consultative sales relationship is based on trust, great value, collaboration, and a long-term view of the market.

An advanced proposition is to raise the bar in your sales organization with consultative selling integrated with business negotiations.

3

GOOD, BETTER, BEST NEGOTIATOR

As a life skill, business negotiation falls into a vague category. It’s not really taught as a business skill until college or university. For the most part, it is not given the same importance as other business subjects such as math, accounting, finance, or marketing. Yet, in my conversations most business people profess to be good negotiators, even though they cannot describe a single negotiation strategy, philosophy or process.

Many years in a successful business career have taught me that the subject of business negotiation is personal and even ego-driven. We spend a lifetime in business, bargaining and negotiating daily but ironically, we seldom take the time to read on the subject or better yet train to become proficient bargainers. Professional business negotiators live in the trenches and learn from the business titans in their respective business categories. Professional negotiators learn not from easy victories over weak adversaries, but by watching and making mistakes in large business negotiations. They learn by sweating for months over important or multi-million dollar deals that could possibly affect the job stability of their business colleagues. They also learn by running a post-mortem on every negotiation they complete grading it via a set of measurable benchmarks.

The reason I work so hard in business is for my family; I want to create a better life for them than I had growing up. So, why on earth would I allow myself to senselessly give away hard-earned cash in poorly executed business deals? Why wouldn’t I try to be my best in negotiating deals, so my loved ones can enjoy a tiny bit more?

Here are five “life changing” reasons to become a better business negotiator.

1)Business external - If we are in business, we will likely engage with customers, suppliers, or both. When we negotiate business deals, we can expect that they will have residual effects on future business. Our ability to negotiate smart, cooperative, profitable deals, affords a sense of stability to our business world and to those we work with. The reason we work for smart cooperative deals is that we want the party we have negotiated with to complete their side of the agreement in good faith.

Cooperation in a negotiation has another important consideration as there are almost always problems that pop up with contract fulfillment. Smart, cooperative deals lay the groundwork for successfully working through smaller problems that must be negotiated to keep the contract delivery on track, on time, and on budget.

2)Business internal - I worked on the management team of Canada’s largest newspaper company. We represented 125+ newspapers and I can tell you without hesitation being a deft internal negotiator was critical. It seemed like every day was an internal negotiation marathon. The smartest professionals I worked beside became proficient at negotiating upward in the organization. They realized the greatest gains were achieved by bargaining with senior managers to get budget approvals, changing policy and making sure year-end bonuses got the full internal bargaining treatment. It pl...

Table of contents

• Cover
• Title Page
• Copyright Page
• Dedication
• Contents
• Introduction
• Part I – Philosophy
• Part II - Exploration
• Part III - Relationships & Trust
• Part IV - Preparing To Close
• Part V - The Close
• Part VI - The Aftermath
• Part VII - 25 Negotiation Strategies
• Acknowledgements
• References
• Index
• Notes