How To Avoid The most Costly Mistakes Most People Make When Negotiating -- Part 1
How To Avoid The most Costly Mistakes Most People Make When Negotiating -- Part 1
There are 6 key principles that if you make them habits you will become a world class negotiator.
Key Negotiation Principle #1: Don't Negotiate Against Yourself
Without doubt the hardest person to negotiate against is ourselves. Yet this is the most common reason for cutting away at our profits. A great example happened to me recently.
I was making my final choice between two clothes wardrobes in a local shop. I could not make my mind up between the two as they both would have been perfect. I asked the owner of the small shop " So how much are they both again?" as I had forgotten how much they were. He replied "That one is £600 and that one is £750 but I can knock off £100 for you."
Without being asked, or without any reason, he had knocked off at least 15% of the price for no reason. I was desperate to get the wardrobes as there were none in our new house. The shop could deliver and assemble the next day and that was hugely valuable to me. It probably wouldn't have crossed my mind to ask for a discount.
So how do we stop this:
*Understand why people buy - I will look at this more in Principle 2
*Never offer price discounts before being asked
Be careful to understand what someone is saying i.e I went into a shop recently and said "yesterday I ordered a Tuna sandwich but you gave me a ham sandwich"
My motivation was nothing more than to ensure that days order was correct and possibly get an apology. The server responded by offering me that days sandwich free. I was grateful but the server was essentially negotiating against herself.
Also beware of the classic line:
"Is that your best price?" This line is taught to all new professional buyers as a standard line to test people with. Most people don't have a clue how to answer this (we teach how to in our sales training courses) and very quickly start chipping away at their own prices. Don't!! Never give into this line.
Key Negotiation Principle #2: Ask Questions To Identify their motivations
We get so used to our products and services and dealing with clients that we can very often think we know exactly what they want and exactly why they want it.
Stop. Never assume that you know what the customer or client is thinking or saying. Clarify what is important to them.
The more knowledge you have of the other persons situation then the better you will be able to prove the value of what you provide as well as deal with any negotiations or bargaining. Our courses are based on providing people with a platform of credible, professional questions that will ensure you find out peoples real motivations and the value they have assigned to your services.
A fantastic question to memorize that you can use if anyone asks for a discount is simply:
"Can I ask you why you need a discount?"
Generally that stumps people and when faced with having to rationalize their reasons they generally give up.
Key Negotiation Principle #3: Avoid easy alternatives such as the 50:50
Avoid the 50:50 split. It is far too easy and really shouldn't be classified as negotiating. If someone offers to do a 50:50 split with you (where you split the difference in prices down the middle) then here is a fantastic way to deal with this.
Purchaser: " I really like your car but think £10,000 is too much. You know I was thinking around £6,000 so why don't we split the difference."
You: " So If I understand you correctly you want to pay £8,000 for the car. Is that correct?"
Purchaser: "Yes. £8,000.
You. Fantastic. I think we are nearly there. So you are prepared to pay £8,000 and I want £10,000. Great. That means we are now only £2,000 apart. How about £9,000?
Purchaser. "Well hang on I was willing to pay £8,000"
You. "I know, but I was looking closer to £10,000. OK then you said split the difference so you are prepared to pay £8,000 and I want £10,000 so by splitting the difference we get to £9,000. Does that make sense?"
Purchaser. "Ah...Ok. Deal!"
Look out for Principle 4-6 in part 2!
To your sales success,
Peter
How To Avoid The most Costly Mistakes Most People Make When Negotiating Part 1 - To learn more about this author, visit Peter O'Donoghue's Website.
Like this article? Share it with your friends
Without doubt, negotiation is the key thing that my sales training workshop attendees think that there is a 'black art' to. I am going to prove to you that there is no black art to negotiation - and in fact you can be a master at it.
There are 6 key principles that if you make them habits you will become a world class negotiator.
Key Negotiation Principle #1: Don't Negotiate Against Yourself
Without doubt the hardest person to negotiate against is ourselves. Yet this is the most common reason for cutting away at our profits. A great example happened to me recently.
I was making my final choice between two clothes wardrobes in a local shop. I could not make my mind up between the two as they both would have been perfect. I asked the owner of the small shop " So how much are they both again?" as I had forgotten how much they were. He replied "That one is £600 and that one is £750 but I can knock off £100 for you."
Without being asked, or without any reason, he had knocked off at least 15% of the price for no reason. I was desperate to get the wardrobes as there were none in our new house. The shop could deliver and assemble the next day and that was hugely valuable to me. It probably wouldn't have crossed my mind to ask for a discount.
So how do we stop this:
*Understand why people buy - I will look at this more in Principle 2
*Never offer price discounts before being asked
Be careful to understand what someone is saying i.e I went into a shop recently and said "yesterday I ordered a Tuna sandwich but you gave me a ham sandwich"
My motivation was nothing more than to ensure that days order was correct and possibly get an apology. The server responded by offering me that days sandwich free. I was grateful but the server was essentially negotiating against herself.
Also beware of the classic line:
"Is that your best price?" This line is taught to all new professional buyers as a standard line to test people with. Most people don't have a clue how to answer this (we teach how to in our sales training courses) and very quickly start chipping away at their own prices. Don't!! Never give into this line.
Key Negotiation Principle #2: Ask Questions To Identify their motivations
We get so used to our products and services and dealing with clients that we can very often think we know exactly what they want and exactly why they want it.
Stop. Never assume that you know what the customer or client is thinking or saying. Clarify what is important to them.
The more knowledge you have of the other persons situation then the better you will be able to prove the value of what you provide as well as deal with any negotiations or bargaining. Our courses are based on providing people with a platform of credible, professional questions that will ensure you find out peoples real motivations and the value they have assigned to your services.
A fantastic question to memorize that you can use if anyone asks for a discount is simply:
"Can I ask you why you need a discount?"
Generally that stumps people and when faced with having to rationalize their reasons they generally give up.
Key Negotiation Principle #3: Avoid easy alternatives such as the 50:50
Avoid the 50:50 split. It is far too easy and really shouldn't be classified as negotiating. If someone offers to do a 50:50 split with you (where you split the difference in prices down the middle) then here is a fantastic way to deal with this.
Purchaser: " I really like your car but think £10,000 is too much. You know I was thinking around £6,000 so why don't we split the difference."
You: " So If I understand you correctly you want to pay £8,000 for the car. Is that correct?"
Purchaser: "Yes. £8,000.
You. Fantastic. I think we are nearly there. So you are prepared to pay £8,000 and I want £10,000. Great. That means we are now only £2,000 apart. How about £9,000?
Purchaser. "Well hang on I was willing to pay £8,000"
You. "I know, but I was looking closer to £10,000. OK then you said split the difference so you are prepared to pay £8,000 and I want £10,000 so by splitting the difference we get to £9,000. Does that make sense?"
Purchaser. "Ah...Ok. Deal!"
Look out for Principle 4-6 in part 2!
To your sales success,
Peter
How To Avoid The most Costly Mistakes Most People Make When Negotiating Part 1 - To learn more about this author, visit Peter O'Donoghue's Website.
Like this article? Share it with your friends
 | |
 |
No article feedback found. |
| |
Leave Your Feedback |
 | |
| |||
Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
|||
George LudwigGeorge Ludwig is a recognized authority on sales strategy and peak performance psychology. An international speaker, trainer, and corporate consultant, he helps clients like Johnson & Johnson, Abbott Laboratories, Northwestern Mutual, CIGNA, and numerous others improve sales force effectiveness and performance. Though it's George's strategies and processes that help corporations increase productivity and performance, it's his tremendous energy and dynamism that spark the transformation. Again and again, clients remark on his amazing ability to unleash human capacity and inspire men and women to break out of their comfort zones. The result is a whole new type of salesperson. His customized presentations teach achievers to make stunning advances in their lives. From helping salespeople realize cherished dreams to helping corporations exponentially accelerate revenue streams, George Ludwig leaves audiences and individuals empowered, emboldened, and clamoring for more. George is the best-selling author of Power Selling: Seven Strategies for Cracking the Sales Code and Wise Moves: 60 Quick Tips to Improve Your Position in Life & Business. - Visit George Ludwig's Website |
|||
Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
|||
Jeff FosterWebBizIdeas.com is a Minneapolis website design company founded to help people start an internet business by providing them with website, business, and internet resources that help foster the growth of successful online businesses and develop innovative Internet business ideas. We specialize in internet consulting & internet marketing. - Visit Jeff Foster's Website |
|||
John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
|||
Stephanie RobeyStephanie Robey is President and CoFounder of Pivot Positive, LLC - an Internet marketing business focused on helping people start work at home ventures. Previously, she was employed at The Search Agency with over 20 years experience in graphic design and 10 years experience in online marketing. She was responsible for launching the Conversion Path Optimization (CPO) unit where she and her team have conducted hundreds of optimization tests for online companies across multiple verticals. She is a successful entrepreneur having started and sold 2 companies and remains on the board of directors of the third, PhotoSpin.com Stephanie began her career in the direct marketing realm creating and producing direct mail for many of the major cable television companies and directly attributes her understanding of Internet marketing to those early offline experiences. Stephanie is a graduate of San Diego State University with a BFA in Graphic Arts and also holds an Executive MBA from the Graziadio School of Business and Management at Pepperdine University. Read Steph's Blog Meet Steph and Dave Sign up for our Free 7-Day BootCamp: Self Employed & Rich - Visit Stephanie Robey's Website |
|||
|
To learn more about the Evan Elite Author Program please contact us. | |||
 | |
|  |
Subscribe to Peter's articles
 | |
|
|  |
 | |
|
| |
 | |||||||
|
 | ||
|
||
|
||
 |
||
|
| ||
 |
| Have you written articles that would be of value to entrepreneurs? Become an expert on our site by publishing them! Expose yourself to a wide audience, drive more traffic to your website and get more sales! Click Here for details. |
|
|
 |
| Modeling the Masters: Learn the true secrets behind Walt Disney's business success factors & grow your company! Video produced by Phanta Media |
|
|
 |
"Learn straight from Evan how you can Make a Full Time Income (And More) from a Website"
Click Here To Learn More |
|
|
|
|
Get advice & tips from famous business owners, new articles by entrepreneur experts, my latest website updates, & special sneak peaks at what's to come!
|
|
|
 Ideal Client Relationships and Referrals Federal Antitrust Laws Startegic Plan Creation 5 Step Action Plan |
|
 | ||
 |
Top 50 SEO Posts - 2007
Top SEO Posts of the Year | |
 |
Top 50 Business Plans
Top Business Plan Blogs | |
| ||
 | ||||
| ||||
|
| ||||
| ||||
|
|
|
|
|
||||||||||||
|
Email us your ideas on how to make our website more valuable! Thank you Sharon from Toronto Salsa Lessons / Classes for your suggestions to make the newsletter look like the website and profile younger entrepreneurs like Jennifer Lopez and Sean Combs!
|
|
|
