From focusing on the intangible elements to being more personal, here are 14 answers to the question, “How can I become a good negotiator?”
- Focus On Intangible Elements in Negotiation
- Slow Down
- Embrace the Uncomfortable Feeling
- Read a Few Books
- Understanding When It’s Time to Walk Away
- Don’t Over-negotiate
- Focus On their Counterparts, Interests, and Motivations
- Aim to Build Relationships
- Always Do Your Research
- Practice Active Listening
- Believe Your Own Value Proposition
- Focus On the “Why”
- Start by Practicing
- Be More Personal
Focus On Intangible Elements in Negotiation
Startup leaders who want to become better at negotiating should focus on understanding the leverage points in their negotiations. For example, rather than focusing solely on money or other resources, consider whether a shift in intangible elements could swing the outcome of the negotiation more favorably for them.
A good example of this is customer loyalty–by seeking out partnerships with organizations that have a loyal following, startup leaders can use that customer base as part of their negotiations instead of having to solely rely on money or resources alone. Doing so helps create a wider range of possible outcomes and ultimately better positions them to reach an agreement they are satisfied with.
Negotiation is very different from normal conversation, so you’ve got to be in a very different mental space to do it well. One of the easiest ways you can improve quickly is to simply slow down. Normal conversation flows quite quickly with few gaps, but when you’re negotiating you have to stay on top of your reactions and be quite purposeful in your reactions. Going into a negotiation pre-armed with the thought process that you’ll slow down and take a beat before reacting or saying something will ensure you’re not just reacting – you’re thinking first, then acting.
Embrace the Uncomfortable Feeling
The only way to truly improve negotiation skills is to embrace the uncomfortable. Learning anything new can be challenging, but negotiating requires someone to ask for more than they usually do and to stand by their claims. For people-pleasers or those described as “nice” by others, learning negotiation may feel more complicated – but the rewards and long-term gain far outweigh the uncomfortable feelings.
Read a Few Books
The late Zig Ziglar wrote a lot of books about sales, as did Tom Hopkins. Tony Robbins often addresses sales techniques in his books and talks. Those are three big names to go by, but there are plenty of other books out there you could check out about sales negotiating that could be useful to you. Such books are full of real-life examples of people closing sales in a variety of ways. Take note of some of those methods and test them out. See what negotiating tactic works best for you. You may copy what Hopkins has done or you may modify a few of his suggestions and come up with a style all your own. Either way, go find out what others have done. It could provide an effective roadmap for your next negotiation.
Understanding When It’s Time to Walk Away
If you’re a startup leader who wants to become better at negotiating, it is important to have an understanding of what the lowest possible price you can sell your goods/services for before walking away from the deal.
As a commercial photography business, the pricing is all custom based on the unique project requirements. When negotiating pricing with clients, I need a really good understanding of our minimum spend requirement for the scope of the overall project. If the client’s budget is lower than our minimum requirement, I need to be able to communicate that it’s not the right partnership. If they want to reduce the number of deliverables to match their budget, I also have to understand if that’s worth it to us and evaluate if we could miss another opportunity that may have the appropriate budget set aside as a result.
As a startup leader, your goods/services are everything and it’s important that you don’t devalue your work by negotiating past the point you are comfortable with.
One crucial tip for startup leaders who want to become better at negotiating is to not over-negotiate. By this, we mean that it’s best to avoid negotiations that drag on for too long and require excessive back-and-forth with one or more parties. They should be kept as brief and successful.
The key is to find a mutually beneficial agreement that meets the needs of all parties involved rather than pushing for too much. By keeping the negotiations brief and successful, startup leaders can improve their chances of success in future negotiations. Doing so will also foster better relationships with their business partners or customers, making it easier to get agreements done quickly and smoothly.
Focus On their Counterparts, Interests, and Motivations
Startup leaders who want to become better negotiators should focus on understanding their counterpart’s interests and motivations. By taking the time to actively listen and ask questions, you can learn more about what is important to them and how it could be leveraged in negotiations.
Michael Fischer, Founder, Elite HRT
Aim to Build Relationships
Startup leaders should always focus on the importance of building relationships, even when it comes to negotiating. Building trusting and meaningful relationships with business partners and customers can help open up avenues for negotiation, as trust is essential for achieving a good outcome.
As an uncommon example, startup leaders could strive to incorporate storytelling into their negotiations. This could involve sharing stories of how they overcame obstacles in similar situations, or connecting different ideas in order to create value that both sides are seeking. Through storytelling during negotiations, startup leaders can have more influence on the outcome due to their ability to make a compelling argument.
Always Do Your Research
One important tip for startup leaders who want to be better at negotiating is to do research. Before entering into any kind of negotiation, it is essential to be prepared and understand the different strategies you can use.
When I first started out in business, I remember trying to negotiate with clients and vendors but would often feel overwhelmed by the process and end up settling for a less-than-ideal deal. This motivated me to do my own research and practice different negotiation tactics, something which drastically improved my ability to make smart and profitable deals. Not only did this help me save money, but it also gave me an edge when going into meetings and negotiations with potential partners or investors.
Practice Active Listening
Active listening is a critical skill for successful negotiations, and it involves not just hearing what the other party is saying but also understanding their perspective and needs. As a startup leader, one way to improve your active listening skills is to practice empathizing with the other party. Try to put yourself in their shoes and imagine their situation, challenges, and motivations. Listen for what they are saying and what they are not, and ask clarifying questions to gain a deeper understanding of their position.
Additionally, avoiding interrupting the other party or dismissing their ideas is vital, even if you disagree with them. By demonstrating that you are genuinely listening and taking their concerns seriously, you can build trust and improve the chances of reaching a successful outcome for both parties.
Believe Your Own Value Proposition.
In the early days, startup leaders tend to focus solely on what’s wrong with the product, with a laundry list of features, bug fixes, and improvements that desperately need to be implemented. This makes it easy to forget what your product actually does well.
Because we are our own harshest critics, we tend to forget our own value propositions and cave in when negotiating. However, after hearing salespeople pitch our product, I would think to myself, “Wow, it’s actually really good!”
When negotiating, you must not lose sight of the tremendous value our products offer and always negotiate from a position of strength. If your product provides 10x ROI to clients, never act like it’s too expensive. If you provide an essential service that companies cannot continue without, don’t let prospects convince you it’s “desirable, but not essential.” Instead, always negotiate under the assumption that your value proposition is correct and never let anyone convince you otherwise.
Focus On the “Why”
The most successful negotiations are rooted in understanding why each party wants. By understanding the motivations of both sides, you can find common ground and create a mutually beneficial agreement everyone is happy with. When you focus on the why behind a negotiation, it can help keep emotions in check and help you remain focused on the end goal.
Start by Practicing
Negotiation is a skill that is essential for startup leaders because it helps them secure the best deals possible. The most important tip to remember is to practice. Start by researching different negotiation tactics and strategies, then practice implementing them in mock scenarios. Once you have a good understanding of the different tactics, practice negotiating in real-world scenarios to get comfortable with the process.
Be More Personal
People want to hear personal stories. Why do you believe in your brand? If you’re just reading from a script and throwing data points out there, it’s not going to resonate with the customer as well as a personal story would. A timely anecdote goes a long way toward making the customer think the salesperson truly cares about what they’re selling. That translates well to the negotiating table, too. Make yourself relatable. That will reduce buyer and/or investor anxiety more than anything else. Make them understand why you believe in what you’re pitching.