Negotiating, when done correctly, creates strong win-win situations for both parties. Unfortunately, most ambitious professionals are stuck somewhere between emulating the stereotypical Hollywood idea of a hardball business tycoon and flashbacks to childhood memories of being told to be patient and wait for rewards. As a result, most professionals fear negotiating and treat it more as a guessing game or blackjack table.
You cannot advance your career or be a successful business owner if you avoid asking for precisely what you want or enter into negotiations without having a plan in place. With that in mind, here are five ways that you can quickly become a power negotiator:
Know exactly what you want
Identifying what you want before entering negotiations gives you the ability to both visualize the outcome and avoid leaving the table with the feeling of selling yourself short. Have an exact dollar amount, terms, etc. outlined on paper prior to meeting with the other party.
Once you identify your desired meeting goal, be prepared to ask for slightly more, allowing wiggle room for your boss or client to ‘come down’ to your desired price. However, don’t be surprised if, using the next four tips, you actually walk away with more than your initial goal.
Understand the other party’s position
What are their requirements and restrictions? Take the time to research the company and/or person you’re meeting with and discover their surface needs, past negotiation outcomes, and what would make them look good. Remember that price is not always the most important factor, contrary to what the client or boss may say.
I was a hotel sales manager in my early twenties. One of the most valuable lessons my Director of Sales taught me was to offer what the competition cannot. As an example, my primary competition for large corporate conventions were two hotels nearby. My property had over fifty suites while each of the other hotels had less than fifteen. As a result, I would offer the meeting planners large quantities of complimentary upgrades for all of the company VIPs. Even offering a slightly higher room rate, I almost always got the business simply because the meeting planner jumped at the opportunity to look good by negotiating suites for company influencers. In the end, it wasn’t about negotiating the lowest price, but the best deal for the company.
Know your value
What do you bring to the table? Are you offering a revenue-generating service to another business? If so, how much money will they make as a result of securing your services? If you’re negotiating for a raise, understand if you’ve greatly outperformed past hires, making or saving the company a significant amount of money. How much would it cost the company to lose you?
Never accept less without gaining concessions
While you may not walk away with the exact dollar amount you envisioned, you can ensure that you leave with your desired ‘value.’ If you’re seeking a 7% raise, but your boss informs you that the best the company can offer is 5%, consider requesting the ability to work from home one day a week or an additional five paid vacation days per year. Figure out an alternative option that is worth that 2% for you. Accepting less without gaining something in return is the equivalent of stating that you are worth less than your initial ask.
Be willing to walk away
Know your bottom-line and always be willing to walk away. While this can be difficult when dealing with large pieces of potential business or even a dream job, it is imperative that you never enter negotiations without the option to walk away. This lessens the likelihood of the other party being able to use hard-ball tactics to back you into a corner. Also, there will be times when you will need to state that their offer is not sufficient, and you don’t think you’ll be able to do a deal. You may be surprised how often negotiations that seem to have broken down completely can be revived when the other party understands that you are not desperate, and that you have options.
When was the last time you negotiated for exactly what you wanted and walked away a winner? What tactics did you use? Share your comments below.