Sales Negotiation Strategies
Sales Negotiation Strategies – First a health warning; this blog article refers to a complex sale, the closer you move to a commodity the less appropriate our advice is.
Furthermore this is a carbon copy of the learning I was taught by Enterprise Ireland’s Export Development Programme.
Sales Negotiation Strategies – Many of our blog entries are about lead generation or opening the door. In other words the start of the sales process, however in this month’s blog entry it’s about the other end of the sale – Negotiation!
Negotiation skills are often overlooked, people prefer to rely on instinct or wisdom derived from ‘old wives tales’.
Sales Negotiation Strategies but What is Meant By Negotiation?
Well it’s a process where two parties attempt to reach an agreement in a situation where;
- Both can vary the offering
- Resources are finite
- There is both common ground and divergence
In a sale an invitation to negotiate is a sign that the prospect is interested, perhaps it’s even down to the last two or three competitors.
The key rules are;
- Never negotiate before you need to
- Concessions rarely influence a decision
- Discounts don’t resolve concerns
Sales Negotiation Strategies – A Five Stage Model
- Prepare – Build a strategy (later on we’ll describe a simple system called MIL)
- Investigate – Understand their needs, concerns and individual people’s influence on the sales decision
- Propose – Develop a solution or prepare alternative solutions in case needed
- Bargain – Be prepare to trade concessions but ensure they’re linked to genuine concerns rather than ‘slicing the cake thinner’
- Close – Ensure the agreement is achieved and documented, even a simple email. You don’t need a 2nd round of negotiation reducing your margin
During the stage of preparation, before you go into the room document and understand your MILs. MIL stands for;
M – Must achieve i.e. the bottom line
I – Intend i.e. what you intend to get
L – Like i.e. what you’d like to get
In summary remember 1. Discount never addresses concerns and 2. Know your MILs
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