Three Keys to Successful Sales Negotiations
When you hear the word negotiation, what comes to mind?
It likely conjures images of your CRM, a ring light shining in your eyes, a giant cup of cold brew and a computer monitor covered in sticky notes. Your palms might even start to sweat a little at the thought — and that’s only natural.
Even for the rainmakers, negotiations are no picnic. They’re stressful events that test the strength of client relationships, reveal weak points in your sales cycle and make or break crucial deals — but that doesn’t mean you can’t meet them with confidence.
Remember to clarify, create value and compromise when necessary. Master these steps, and you’ll see negotiations as mere speed bumps on the road to the finish line.
You’ve been working on this deal for six months, and today your team (and your competition) is presenting to the buying group — you’ve engineered it so that you’re the last company to present. In an attempt to win this contract (it’s a logo that anyone in your industry would be thrilled to land), you’ve already priced this one pretty close to the limit.
After a round of responses, you’re hit with reservations on — you guessed it — price!
Are you tempted to go even lower? Do you explain exactly how close to the limit you already are?
What if you’re priced too low? Maybe the potential buyers are worried that you won’t be able to deliver at that price point? There could be quality issues down the line or the need to revisit aspects of the project that will lead to future price increases.
Bottom line: You can’t begin a successful negotiation until you’ve clarified the other’s party’s position. To do this, fall back on the same techniques you used to identify and confirm the business issues in the first place: open, probing and confirming questions.
Create Additional Value
The first box to check is differentiation. Are you confident that you’ve connected all of the tangibles and intangibles that your company can offer to your prospect’s needs?
If you’re unsure, remember that impactful differentiation extends beyond product capabilities. Look to these three areas to uncover additional value:
What’s different about your CX that solves the client’s problems? Maybe you offer 24-hour support with live agents, free user training or guarantee a response from a tech lead within 48 hours.
Half of modern selling is building buyer confidence. Perhaps you’re a hosting provider with a 99.99% uptime guarantee in your SLA — that’s a powerful factor for an enterprise that’s experienced reliability issues in the past.
Or maybe you’re a sales tech startup in a hyper-competitive market. You may not have the resources of the big players, but you have loyal customers. Offer to connect the potential buyer with one of your clients. Candid, peer-to-peer conversations can do wonders to build trust.
Terms and conditions
Can you start immediately, but bill next year or next quarter? Especially in Q4, being flexible with billing can make all the difference.
When all else fails, and the potential buyer is still asking for a 15% discount, what do you do? Well, for starters, you should have had the value conversation long ago — if not, you’re facing a steep and slippery slope. Let’s assume you’re on level ground.
Next, think of how you can add value through trades or embellishments. If the buyer pays upfront, can you accommodate the discount? Remember that end-user training from earlier? Try extending it to their entire team.
If you’re not empowered to make changes like that, try adding in high-value, low-cost offerings. Can someone on your team help your potential buyer migrate from the competition’s solution to yours? Does your company really need all of those seats at the next big conference or industry networking event?
You get the idea — be creative when and where you can to delight customers without cutting into your margins.
If you want to dive deeper into mastering sales negotiations and set yourself up for a strong Q4, check out:
- “Scary Stuff: The “P” Word…Price” in the LinkedIn Sales Blog
- Our Nov. 18 webinar: “Forecasting Checklist to Close the Quarter & Year”
- “5 Ways to Make Objection Handling Your Superpower” in the LinkedIn Sales Blog
Until next time, happy selling,