Insights on Business and Sales Negotiations

Nogotiation Blog

Insights on Business and Sales Negotiation

Join us for insights on how to negotiate a winning balance, where where both sides understand and appreciate the value they receive. As a result, you are more likely to forge a long-lasting relationship that yields more and better opportunities in the future. This idea underpins K&R Negotiations’ Win Wisely™ approach and underlines the importance of using leverage wisely.

When Emotions Compromise Your Negotiation Leverage

July 29, 2014

Successful businesspeople like to think of themselves as rational beings that apply thorough analysis to get optimal outcomes. Of course, this is not always the case. We’re humans, not optimizing machines: We’re biased towards doing business with people we like and trust; we succumb to pride when a calmer perspective would have yielded a better outcome for everybody; we get emotionally invested in a deal and can lose focus of its true merits. It is easy to become emotionally invested in a deal, especially a complex one that has required a large time and resource commitment from you and your team. Nobody wants to simply walk away from something they have cultivated for months—even when the rationale for actually doing the deal starts to dwindle. We once engaged with a client who…

Unprincipled Concessions Cost You Money at the Negotiating Table

June 25, 2014

Spot Them, Avoid Them and Close Faster Unprincipled concessions are concessions not tied to a credible business rationale. Years of research show us that this simple business negotiation mistake costs companies between 9 and 18% of their gross operating revenue. The most basic negotiation example of an unprincipled concession is this: To test your negotiation acumen or your value proposition, your client asks for a large up-front discount. You immediately agree without reference to the value of your solution, thus making an unprincipled concession. At this point, the potential client is thinking two things: They could have asked for and received an even bigger discount You don’t know the true value of your offering An unprincipled concession can have a snowball effect…

Negotiation Success Range (NSR)™: Understanding Walkaway Positions so Neither Side Walks Away

June 18, 2014

One of our tools for helping clients prepare a winning negotiations strategy is the Negotiation Success Range (NSR)™, which identifies the conditions under which both parties will be satisfied. And if those conditions satisfy both sides, but our side likes them more than theirs? That’s OK: A winning deal is never perfectly even. In business, especially when forging long-term relationships, the NSR is critical because the deal should work for both sides, and both sides need to feel like they have won. This is easier said than done. As an example, during negotiation planning the seller’s price and the buyer’s cost are often crucial factors in the deal. In fact, price is often a deal maker or a deal breaker. (The impact of price considerations on your deal can be ameliorated with…

To Close the Deal, Know Your Client’s Risks and Articulate the Cost of Not Acting

March 14, 2014

In 2013, CSO Insights published an industry survey summarizing deals won and lost—in this instance, how often forecasts lined up with actual closed deals. Of the number of total forecasted deals, 26% were lost due to “no decision.” Many “no decisions” can be traced to a seller’s inability to address how their potential client sees risk and the failure to paint a compelling picture of the cost of not acting. In our sales and negotiation training seminars, we teach sellers how to prepare and increase their chances of a win by carefully considering risk and reward from the buyer’s perspective. Traditionally, sellers focus primarily on the reward/benefit/value to the buyer of completing a deal. The risk/reward exercise has a dual value: By convincing yourself, you increase your…

Balancing Your Negotiation Team: If Everyone Agrees, Someone is Probably Wrong

February 14, 2014

Just as you don’t want to take to the field with a football team of 11 quarterbacks (or 11 goalkeepers, if you’re playing the more globally known form of football), you would not want a negotiation team that only represents one discipline or perspective. Although Peyton Manning or Cristiano Ronaldo each has enviable skills, other specialists will be needed to secure victory for the team. We once worked on an important licensing negotiation with a client team comprised of architects and engineers in product development. Their goal was to fill a technical gap in their product. They were willing to pay an amount for the license that was equal to the cost of developing the solution themselves. But with no one on the team from sales, marketing or finance, there was no way for them to gauge…

The Value of Role Playing in Negotiation

January 17, 2014

We have had the privilege of assisting major companies all over the world with our Win Wisely™ approach to negotiation. The principles we teach are far from theoretical: they were forged from practical experience gained in all kinds of negotiations involving all types of participants. This includes everything from basic buy-sell transactions to complex, high-stakes negotiations in business and technology conducted by lawyers, salespeople and executives. Each of them needed a methodical approach to forging better deals. We routinely hear from our clients. They describe how the teams we have trained are able to put their learning to immediate effect. One reason is that all our workshops attendees practice what we teach, often with real negotiation opportunities. Learning needs to be coupled…