Selling is all about negotiation. And if salespeople don’t have this skill, you won’t succeed, even if your business processes are set up correctly.
To see if managers need to develop negotiation skills, look at these points
- How easily and quickly do they concede on price?
- Do they know what “bargaining variables” are?
- Do they offer the customer additional services or products from an extended range?
- Do managers ask for reciprocal concessions when they agree to the customer’s terms?
A discount is just as much a commodity. It can’t be given away for free, it also needs to be sold. For example, for quick payment terms or for buying additional equipment.
What a manager should know about negotiation skills
The difference between selling and negotiating is that in selling, the seller’s desire to sell is higher than the buyer’s desire to buy. In negotiation, however, these desires are equal.
- It is important to be prepared for the first meeting with the client. The manager must think about how to connect with the client and tune in to him.
- It is necessary to prepare for the negotiations every time. It is necessary to understand in advance where the interests of the salesperson intersect with the interests of the client. It is better to be prepared for different variants of events.
- It is necessary to find out the position of the client – what terms of the agreement he came with. And it’s also important to understand the interests of the client – price, payment terms, delivery terms. That is, what he is protecting and what he is striving for.
- The negotiator’s task is to find common fields of interest and negotiate terms based on them. Interests do not necessarily have to relate to the current negotiations, they can be the personal interests of the client, and his hobbies.
- It is important to keep in mind the variables of bargaining. Usually, it is the price, payment terms, delivery dates, and other additional features. Let’s look at a specific example.
Let’s say you want to sell a product for $100,000. The minimum price you are willing to go down to is $120,000. You are negotiating with a buyer who wants to buy your product for $100,000 but is ready to move up to $140,000. Then the range from $120,000 to $140,000 is called the “Bargaining Zone” or “Bargaining Arena”.
Such schedules are made for each element to be negotiated – price, terms, etc. If one schedule changes during the negotiation, then change the others as well. For example, if the price changes, then discuss changing the payment terms or delivery terms.
After the end of the negotiations, you need to summarize the results and outline a plan for further action. You should not make concessions after the contract is signed.
How to teach salespeople how to negotiate properly
- Change the scripts by which managers communicate. Pay more attention to dealing with objections. Do not forget that the conversation should be managed by the salesperson, and to do this, let him ask more questions.
- To detect negotiation errors in time, include the negotiation steps in the managers’ development sheets and keep them in mind for further training.
- Inform the salespeople of what terms the company is ready to discuss with the client, and on what issues they should stand their ground.
- Control the telephone conversations of managers, to detect errors in communication.
- Conduct regular negotiation training sessions and discuss their results with the entire team.
- Provide negotiation training from a specialist. The money spent will be repaid when the manager brings in new clients and sales increase.