Negotiation Examples: How Avoiding Unprincipled Concessions Kept the Customer’s Respect (And Won More Revenue)


When competition starts putting the pressure on you, it’s natural to look at price-cutting as the primary way to keep the business. But in the long run, this is a mistaken impulse, unless accompanied by a sound business rationale such as a reduction in scope, change in terms or outcome from the deal. One of our engagements with a client that served a European industrial (the customer) with technology solutions definitely illustrated the value of avoiding such “unprincipled concessions!”

Unprincipled concessions are “giveaways” not tied to a credible business rationale. Our research shows that this simple business negotiation mistake costs companies between 9 and 18% of gross revenue and significant profit. (See our infographic on the topic for a more detailed discussion of this vital principle and how it can be applied.) Read more

Negotiator Training Works: ROI for Global Training and Negotiating Firm

negotiation training resultsClient teams that walk out of our negotiating seminars come out with actionable tools they can immediately apply to shorten sales cycles; close bigger, better deals; and build lucrative, long-term relationships with the opportunity for more recurring business. It’s one thing to make the claim, quite another when a client’s own analysis supports that claim.

K&R Negotiations engaged with a global training and consulting firm for complete negotiation training aimed at closing more business for their services, based on the K&R Win Wisely methodology. They were quite pleased (and so were we!) with what they found:

  • The client’s closing ratio was 35% prior to negotiator training, with a targeted goal of 50%. After training, closing ratio increased to 73%.
  • The client’s goal for margin of improvement of all national deals was targeted at 15%. They exceeded this goal by attaining 17% improvement.
  • ROI for the client’s negotiator training was calculated at 271.5% for a seven-month payback period.

This is a strong testament to the value of investing in your staff’s negotiation skills. Our global client was not the first to report results like these. If you would like to learn more about how K&R Negotiations helps clients Win Wisely at the negotiating table, please see our negotiation success stories.

Negotiation Examples: The Value of Persistence

negotiation motivation

I often ask people, “Who are the best negotiators in the world?” The most common answer is, “Children.” Yet, children have never been trained in negotiations (certainly not by us). What makes them such naturally effective negotiators?

There are a number of answers to that question. For example, children use tactics of emotional blackmail (screaming in a public place) or they will “negotiate” with principled concessions (“I will eat the peas if you let me stay up until 10.”). The answer we hear most often is that children are naturally persistent – they just don’t take “no” for an answer. Their wants are simple (“I want a cookie.”), yet they have the willingness to repeat the request as often as needed to get their desired outcome. Any parent can tell you about a repetitive argument they’ve had with their child – the child, being persistent and having absolutely no sense of time pressure, simply repeats the same argument over and over again until the parent loses patience and gives in. Read more

Thoughts for the New Year

Email in-boxes are getting flooded with “Thanks for your business” and “Best wishes for the New Year” emails. While there is a certain mechanical nature to these, if you have a relationship, the sentiment is a reasonable one.

So…if you are one of our clients, you have probably already heard from us, but…

Thank you for your business. Our most sincere hope and one of the driving values of K&R is that we have provided a service which has had a positive impact on your business.

Whether you are our client or not…

Please accept our best wishes for success in the future, both personally and professionally. In addition to the daily concerns of our personal lives, we wish for improved conditions in the world on all fronts.

At year-end many people look back, and then forward.

We are in the midst of reviewing K&R’s mission, values, and our 2010 performance. Here is one set of data which could be useful to you if your business is in the planning cycle for 2011.
We looked at a random sample of evaluation forms received at K&R’s various Negotiation Training sessions, and here is what we found:

• Attendees’ overall satisfaction with K&R skills training is exceptionally high. On a 100 point scale, we rated a 93.8.
• 100% of our attendees believe that the skills we teach are useful, and 81% of them say they will use them within the month following the session. 26% say they actually use the skills within 2 days.
• 100% of attendees believe they will get a repeatable benefit from the skills.
• Attendees report that they expect to shorten their sales cycles by an average of 2.8 weeks.
• While not all people estimate a quantified outcome, those who do believe that their results will improve by 20%.

If you need a return on investment for your sales team that is essentially immediate, shortens your sales cycle, and can improve your financial performance by 20%, please consider K&R Negotiation Skills Training in 2011. If you don’t need that, then carry on as you are.

Happy New Year. (td)

Got a question? email a K&R negotiator directly at: [email protected]

Saving your way to prosperity

Times are tough.  The stock market is at 1997 levels.  Unemployment is high.  Sales are down.  You need to manage your business results for 2009.  What do you do, and why?

If we were playing the television game show “Family Feud” (or Family Fortune, if you’re in London), the number one answer is…  Stop spending!

How about it?  Can you save your way to prosperity?  While careful spending is always a good practice independent of the economic conditions, will it make you or your company successful?  Probably not.

Let’s look at the economics of earnings.  The big number isn’t the cost line.  Well, the big number shouldn’t be the cost line – too many people are losing money at the moment.  The real leverage to improve your business results is in the revenue / profit line. One method to improve revenue and profit is to do more with what you have – make the most of the opportunities that still exist.  Through the use of effective negotiation skills, you can take those same opportunities, and get better results from them.  So, in the balance sheet of a difficult year, do you spend to improve the “big” lines (revenue and profit), or do you slow spending to affect the “little” one (cost)?  We think you should do both – but don’t decide based on an arbitrary fixed rule like “no outside spending!”  Use the same good business judgment that has made you successful in the past.

One of the popular K&R services is a series of consulting engagements to alter the outcomes of negotiations that are in progress right now.  We delivered a set of these for a client near the end of 2008.  In that K&R Opportunity Workshop we worked on 22 identified sales opportunities.  Prior to the session, only 2 of the opportunities were expected to close.  All, of course, were in the “forecast” to close, but experience shows that a forecast is more often a wish than an accurate prediction.  As a result of the workshop, eleven of the opportunities were closed by year-end, and our client beat their revenue and profit targets.  We helped them make the best of what they had already.

In a typical two-day K&R Negotiation Workshop session, where we focus on immediately applicable skills, 10-15% of the attendees use something they learned in the session in a real negotiation – before day 2 is over!  We consistently receive feedback that the attendees will use the tools and techniques within 30 days, and we have documented cases of increased revenue and profit that average 10%.

Contact us – we can help you improve your results.  (td)

K&R Success Stories Published

K&R Negotiation Associates has published a few representative success stories on the K&R Web Site.  Here are excerpts and links to more information:

  • K&R’s client turned a $150K annual loss into a $50K annual profit, while at the same time raising their own client’s satisfaction with the service. (more)
  • K&R’s client realized 6.7M€ of revenue in their current fiscal year, and 60.2M€ additional revenue within two years. (more)
  • K&R’s client benefited between $13.5K and $250K. The ultimate buyer saw a clear ROI from the total $837K investment in our Client’s products. Both our client and our client’s client were rewarded through the application of K&R negotiation principles. (more)
  • K&R’s client did not offer expensive guarantees and rebates as part of their services package. This will positively affect profitability as the agreement executes. The result was generated by carefully understanding client needs before offers were made. (more)
  • K&R’s client closed $2M higher than expected, using a few simple K&R principles. (more)
  • K&R’s client benefited by up to $65K, and began the process of breaking a pattern of discounting with their client, which will repeat in every transaction. Our client’s client was satisfied, because they understood the value of what they were buying. (more)
  • K&R’s client closed for $1.6 to 2.1M more than they expected to, using K&R’s value principles. (more)