Recently I was negotiating with one of the big corporate house and thought of sharing my experiences on the same:
How many time have you encountered the situation when your client tells you:
You have to be very price competitive if you have to qualify for our screening.
I agree that your product and services are superior and so is your competitor’s but you have to drop the price otherwise we would be left with no option other than going with your competition.
What additional can you provide at the same price.
Trust me I have faced this situation ‘n’ number of time and have felt really miserable especially when you know that this particular deal is really important for you as well as for your organisation. At this stage how you handle your customer and negotiation process will help you close the sale. You need be very cautious and should keep following points in mind before starting with the negotiations;
1) Is your product really serving the need and is providing the benefit that customer is looking for.
2) It is essential for you to know how much time would the customer will take to close the deal, may be at this point of time they are just looking at the options and negotiating at this early stage is not advisable.
3) Try to get the information about your competitors, this would help you understand who really is your strong competition and accordingly you can position your product/service.
After you have done your homework and you know that you are in a strong or similar position to your competitor and your product/service has all the ingredients that the customer is looking for, its the time when you should sit on the negotiation table.
To have an effective negotiation you should always:
1) Make sure you are not negotiating with anyone, it is always advisable to sit on negotiation table with the decision maker, user may not always be the decision maker. It is important to identify the decision maker before starting the negotiations.
2) Quote your price firmly and confidently, nobody is there for social work, the main motive of the business is to make money. It is you who know your product well and nobody else.
3) Never offer your best price to early, let your customer be the first to quote their expectation.
4) Be patient as most of the big corporate deals does not happen in few hours or few days. Both the parties have their price limits set in their minds, it is OK to ask for the time if you think you need to discuss with your management before offering the final price. Do not bring you ego during the negotiation process.
5) Know you lower limits and when to stop negotiating as there is no point closing the sale for loss, this would not only cause loss to the company but will also tarnish the image of your company as you will not be able to deliver what you have promised when you close the sale for loss.
6) Make sure to provide all the details of your product/service and the benefits that they will be getting in doing business with you and your company.
“During a negotiation, it would be wise not to take anything personally. If you leave personalities out of it, you will be able to see opportunities more objectively.” – Brian Koslow