In a long sales career there are many opportunities for negotiation. Companies and products with poor value propositions make it hard on sellers to hold full price.
With that said, sellers and our sales leaders are responsible for not creating an “end of month rush” or “end of quarter pressure” to close business because if we do, margins will shrink.
There are 4 things to discuss when it comes to negotiating –
When you sell value and solve or fix buyer’s problems, there is no need to discount. If you join the buyer on their buying journey and understand the milestones, you won’t need to pressure your buyer “just because it is the end of the month / quarter / year”. Everyone KNOWS they can get a great deal at these times because many sellers are desperate to hit their number. Public companies can be the worst (in my opinion) because results are publicly reported. Sales Leaders become obsessed with one question, “When’s that deal coming in?” and the alternate question, “What will it take to close that deal?”
Sales leaders, help your reps work a sales process where there is no desperation at any point. Sellers, work up front with buyers to better understand why they are staying in their status quo and how you might further offer help for them to improve their status quo with your services or products.
You made your offer. Your buyer says it is too much.
This is the point where it is incredibly important to not be emotional – going to that place of frustration or anger or even disappointment. When a buyer says your price is too high, at that moment it is simply a point of information – nothing more – nothing less.
Simply ASK them, “How much too much do you think it is?”
Example: I propose an agreement that is $10,250.00.
Buyer tells me it is too much.
I can get mad, frustrated, or, I simply ask, “How much too much do you think it is?”
They tell me, “I only have signing approval for $10,000. If you rewrite it for that, I’ll sign it today.”
In my head I might have been thinking “I can go to 9,000.00 but that’s it…” because in my head it triggered an idea that my service is similar to one that sells for less – but the buyer didn’t even think that. I DID. After having a calm, follow up question I learn that they said this simply because of signing logistics. Don’t make a bigger issue in your own mind than you need to.
This is the time to pick up the phone because it is difficult to tell tone through text or email. The only negotiating I do by email or text is with trusted partners who know my intentions.
I’ve often written that in order to excel in sales you need to understand psychology / human nature, business fundamentals, negotiation, communication and empathy. Be a student of negotiation. I have posted a couple of reviews of Never Split the Difference – Negotiating As If Your Life Depends on It by former CIA hostage negotiator, Chris Voss. Read the book and learn a new strategy for success.
Listen to the Steal the Show podcast with Chris Voss and Michael Port if you prefer to hear ideas rather than read them.
Lifehacker also shares 5 Tips to Negotiate Better that are helpful.
Keep learning, keep growing.
We will have a separate conversation on negotiating for a raise or a new position in a future post.
Lori Richardson helps mid-sized companies grow revenues by solving key issues in their sales department - like recruiting, retention, diversity hiring, process, pipeline and leadership. She speaks at CEO groups on topics of sales growth. Clients include companies in the technology, telecom, manufacturing, distribution, and professional services industries. Subscribe to the award-winning blog, follow her on Twitter
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