“Gaining higher prices” has been the top negotiating challenge for three years running. This year’s top challenges indicate a laser-sharp focus on negotiation outcomes — prices, wins, and profits. “Closing win-win deals” shows the value sellers place on building trust and credibility in order to develop long-term, productive relationships. “Maintaining profitability” is a challenge made visible by the greater availability of real-time sales data, which allows organizations to be smarter about decisions affecting profits. “Managing procurement” is another response worth noting, rising from 4% in 2016 to 11% in 2017. This reflects the increasing involvement of procurement staff as they join the decision-making team late in the process without any emotional attachment to the deal. Their role is to drive down price or get additional products or services for the same price. While this specific challenge didn’t make the top three, its impact is reflected there.
Richardson’s Negotiation Insights
Trust and credibility are keys to managing relationships with customers and closing win-win deals. Sellers can’t claim trusted advisor status; it has to be earned. Being a trusted partner begins with integrity but also requires skill and strategy, which can be learned and practiced.
Sellers need a process for how to negotiate a win-win deal, understanding when and how to unlock a deadline and when it’s best to walk away.
In closing a negotiation, be prepared for the “nibble,” in which clients expect something extra without additional cost. The response should depend on how the change affects the seller, profitability, and the relationship. Throughout the negotiation, sellers need to stay in control of the process, follow up thoroughly and quickly, deliver on the agreed deal, and check for satisfaction.