Ultimate Guide To Negotiating Effectively7 mins - Introduction
Negotiating effectively is helpful for resolving situations in which two separate parties have conflicting wants and are willing to try and compromise with one another. The goal of negotiating is to find a common ground between the involved parties that’s acceptable to them all. It leaves both of them feeling like they’ve been able to benefit from the situation in a way.
Nearly every day, businesses are negotiating with customers, suppliers, and other businesses. Many of the negotiations are so quick and subtle that the people involved may not even realize that they just completed a negotiation. Negotiating effectively is a key component of business transactions that can significantly improve both business and individual operation. Negotiating effectively can reduce stress, save money, save time, and strengthen relationships between different entities. It will lead companies to higher sales, more satisfied customers and suppliers, and better deals.
This guide will introduce you to what negotiating is and provide you with a list of strategies and techniques that will help you become a grade-A negotiator.
Defining Successful Negotiations
Negotiation is defined as a way in which people are able to settle their differences. The process involves an agreement or compromise between two parties that been reached. It helps to avoid a dispute or an argument. Negotiations start off as disagreements, and each of the parties wants to achieve the best possible outcome for their company. Negotiations help to strip away this mentality by inserting the principles of fairness. The parties then try to find a mutually beneficial situation and attempt to maintain a respectful relationship with each other.
How to Successfully Negotiate in the Business World
Don’t immediately show all your cards
In any deal, you want to teeter between the lines of giving and receiving. Consider the negotiation as a card game. You want to be fair, but also want to make sure that you don’t put yourself at a disadvantage. The goal is to get something in return as you give something away. Consider using the phrase “I’ll do this if you do that,” when negotiating. It helps to keep the ground even and allows you to keep a firm foot in the negotiating process. If you give something without receiving something in return, you’re setting yourself up for the opposing party to ask for more and therefore leaves you in a compromising position. They expect you to continue to compromise and you’ll be left feeling thoroughly unsatisfied.
Don’t take things personally
Negotiations are a business transaction. It’s, therefore, best to keep it in the realm of business. Unsuccessful negotiations often swerve into personal issues that are not directly related to the deal. This invites problematic compromises that can leave both parties emotionally exhausted or on uneven ground. Focus on solving the problem. Focus on finding an agreement that respects both parties equally. This is especially important to keep in mind when you’re dealing with rude or insistent people. The way they’re acting isn’t a direct result of their interaction with you. There are so many other factors to take into account their actions. What if they were having a bad day? What if they’re used to experiencing aggressive negotiations?
Don’t focus on your pressures. Focus on theirs.
When it comes to negotiations, debates, or other similar interactions, our initial response is to focus on our own pressure and to try and emphasize our reason for trying to make the deal work out. Focusing solely on your side of the proverbial fence will limit you when considering options. It puts you at a disadvantage. Consider this – what is the pressure on the other party’s side of the fence? It not only helps to build much-needed empathy but also helps to make you feel better prepared. You can appeal to their pressures. Both of you have your concerns and worries going in, even if either party doesn’t say so. Try to figure these out and use them to your advantage.
Tell the other party who their needs will be considered.
Much like number three, you’ll want to consider the other side’s perspective. We all function differently on both the business and the individual level. Take into consideration what the other negotiator wants and show them how this agreement will benefit them as well. Take into account the concept of paying it forward. If you’re showing a willfulness to see their side of the deal, they’ll feel more obligated to work with you. Kindness brings about kindness. If they feel fulfilled, they’re more ready to work with you.
Don’t rush things
Patience is key in negotiations. In the modern-day world, we’re running at what feels like the speed of light. We want to move onto the next thing. But rushing is a sure way to end negotiations quickly and not in your favor. Rushing increases the odds of making mistakes and losing money. The side who has more time on their hands to negotiate is the one who has the true advantage. They can continue to discuss the deal and the impatient side will either be quick to take whatever deal was put on the table or worst, come up with no compromise.
Be an optimist
In the most basic sense, if you aim for the moon, you’ll land among the stars. Walk into the negotiation expecting the best outcome. At the start of the negotiations, approach the other party with something that is a bit extreme. Asking for more at the beginning, especially when it’s above what you initially expected to gain, will help you to get your actual desired amount. Buyers should consider offering less than you are prepared to pay. Sellers should do the opposite.
Do some research
Going in prepared will help you in so many ways. Prior to the meeting, gather information on your fellow negotiator. Consider their pressures, what their needs are, and their options are. Research is important. You won’t be able to decipher what the other side’s situation is without doing some. A lack of information can literally mean a lack of money.
Give yourself permission to walk away
It is true that we want to have a successful negotiation, but we also want to make sure that we have options. Depending on the success of a negotiation can leave you with a hard time saying no. When heading into a negotiation consider saying this: “I will walk away if I can’t get a deal that is satisfactory on ‘x’ level.” It puts a clear boundary in your head and lets the other party know that you mean business. Flexibility is important, but you also need to have a clear line (mostly for your benefit) so that you’re not willing to compromise too much.
Ask for what you want
Assertion can be difficult, but it is necessary for a successful negotiation. Many times, it’s the assertive negotiators who challenge things that get exactly what they want. It communicates a sense of confidence to the opposing party and can, therefore, make them feel more compelled to bargain with you. This assertive nature is asking for what you want and not taking “no” for an answer. Practice makes perfect for this. It’ll help you to control your anger or anxiety when negotiating. The key here though is to be assertive without being threatening or too off-putting. These types of negotiations go better when the speaker focuses on “I” statements. For example, if something someone is doing makes you uncomfortable, don’t say: “Don’t do that.” Instead say something like: “I don’t feel comfortable when you’re doing that.”
Be sure to understand the difference between being aggressive and being assertive. Assertion is putting forth your needs but staying respectful to the other person’s interests. Being aggressive is basically being selfish, which will undoubtedly compromise the negotiation. Lacking an empathetic way of perceiving the other side’s point of view is being aggressive.
The same, in some cases, goes for challenging your fellow negotiator. Doubt what they’re saying while still being respectful of their side. Challenging things is thinking for yourself. It means taking your research and wondering if there are flaws in it. In a sense, it means tapping into your wise mind – a space in which the logical and the emotional parts of our mind come together and allow us to assess a situation from a broader perspective.
Stay silent and listen to the other person
Many times, when we’re passionate or nervous, we tend to blab on and on. In a negotiation situation, we may be inclined to tell the opposing side every side to our story so that they can understand where we’re coming from. This puts us in a situation where we’re overcompensating. Instead, you should know when to answer the right questions and then when to become silent. Have faith in the other negotiator. They’ll tell you what you’ll need to know, you just have to be open and willing to listen to them. Listening is actually the key concept of negotiating. It can help resolve so many problems. It’s understandable that we want to be heard but we can’t forget that other people want to be heard too. Negotiations are about compromise.
As a matter of fact, you’ll help yourself by letting the other person do most of the talking. It’ll help make you an effective listener. Consider listening to the person for about seventy percent of the time and talking for only about thirty percent of the time. Invite the other party to talk to. Let them ask many open-ended questions. They to avoid having too many questions that can be simply answered with a “no” or a “yes.”