Guest post by Kurt Smith
Your palms start to sweat. You’re thinking about this quarter’s benchmark. You can’t remember what your purchasing agent said about your most recent vendor, but you know that you need this sale. Actually, you need the next couple of sales. Negotiation – that’s how you’re going to succeed. Your prospects want to pay less than your sticker price. You want them to pay at least that much. How can you make a deal that results in both parties walking away winners?
Understand Your Value
If you don’t come to the negotiation table with some type of value, you’re already dead in the water. You have to know why your product or service is valuable to your prospect. For example, maybe you sell computer software that automates a company’s accounting processes. The company you’re meeting with is hesitant to buy anything from anyone because they believe accounting needs that “human touch” and discretion to be effective – that accounting isn’t just numbers on a screen.
Why would your software be valuable? Perhaps it doesn’t completely eliminate human beings from the equation. By automating the actual accounting processes, it frees up the accounting team to focus on qualitative problems instead of quantitative ones.
Computers are fully capable of doing math. But they can’t think – this is the value in your product. Your software allows your prospect to be more creative with its finances. That, in turn, will allow it to become more productive – which results in a better bottom line.
To this end, you could design a presentation to show how your product fosters creativity, productivity, and profit.
Listen To Your Prospect
Becoming a better negotiator isn’t about talking him into a sale. Often, listening is what will give you the edge. Knowing which questions to ask is often far more powerful than knowing what magical phrase will make him buy. In most circumstances the prospect already knows what he needs to do.
He just wants to see if you’re paying attention – he wants to know if you have the solution. There’s this delicate dance that goes on during negotiations. The prospect wants to know that you understand his problems; that you are listening.
Listening also provides you with clues as to how to present your offer. For example, if the prospect happens to mention that his company just spent a lot of money building out a new department, then it might not be the right time to ask for a lump-sum of cash. Maybe your prospect can finance the purchase of your product instead.
Learn To Become A Problem-Solver
Inevitably, prospects will throw up walls to block a sale when they just don’t feel like they can buy from you right now. How do you overcome this? You learn to be a problem-solver. Let’s assume that your prospect can’t make a move for 30 days because they’re waiting on financing for some other project. You don’t want to just leave the room with a “maybe” or “come back in 30 days.”
You might lose the sale. Instead, you could confirm that the prospect does indeed need your product or service, and have them sign a contingency form – they agree to buy from you now for a discounted price. You get commitment now. All you have to do is invoice them in 30 days. Problem solved.
Kurt Smith has extensive experience in sales and marketing. Originally from Austin Texas, Kurt recently he has taken on a role as a sales team leader for a telesales firm in Manchester in the UK where his wife is from. In his new role he finds he often needs to keep the team’s morale high and he is always researching ways to improve their day. On weekends he enjoys mountain bike riding and going for walks with his wife, Linda and their basset hound Dusty. His articles mainly appear on business blogs. Visit the NextDayLenses.com website to see how they use it to offer solutions to potential customer service issues.
The Product Management Perspective: Product managers negotiate all the time. Learning how to sell your ideas effectively will increase the value of your products, as well as your value to the company. You won’t win every time, and that’s not a bad thing, but initiating more dialog will improve your products overall appeal.