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.

The Best Way to Manage Mistakes at the Business Negotiation Table

May 17, 2013

Imagine that you are in a sales negotiation. As part of your services, you will create a solution for an inventory problem that your customer is having. In the middle of the negotiation, a member of your team tells you that this solution can only be implemented manually, which will drive up the cost $250,000. What do you do? Omit the solution in the next agreement draft and hope the other side forgets the whole thing. Tell the other side that you’ve made a mistake, but you will absorb the cost of the additional $250,000 since it was your mistake. Immediately notify the other side, apologize for this mistake, and tell them that if the solution is still of value to them, $250,000 will have to be added to the price. Say nothing and eat the additional $250,000. Keep silent. Add…

Defining Value in Negotiations: K&R’s ViO™

March 21, 2013

"We're giving you $100K of value for only $60K. This is a good deal!" How often have you heard that sales pitch? Of course, this has nothing to do with business value. Value is derived from outcomes, and a statement like the one above derives from price. Yet defining value is one of the most critical negotiation steps. The strength of your value argument is what ultimately decides your ability to establish a uniquely defensible position and command your own price. Our negotiator training stresses that without a compelling value argument, you're vulnerable to continued discount requests from a potential customer and price cutting wars with your competitors. As a basic exercise in defining sales value, use this simple equation as a test: BENEFIT - COST = VALUE If you fail to calculate…

International Negotiation: Using the MID™ to Cut Confusion

February 6, 2013

“We must have a 10-day shipment guarantee.” “This functionality is a must.” “A price reduction is mandatory.” How often have you heard conditions like these during a negotiation? Sometimes negotiators make every request sound as if it were mandatory. But what are the real deal-breakers? K&R’s MID™ is designed to help you identify and prioritize the issues in any negotiation. Using the MID, you can separate and deal with the truly mandatory goals (or ends) while reducing conflict over issues that may not be mandatory. The MID approach makes deals easier to close. Means are alternate ways of accomplishing goals. The ends are the goals. Unfortunately, many people naturally talk in terms of means; they articulate the easiest way of getting what they need. This can cause…

Negotiation in Sales: Presenting the Value Argument that Wins in Highly Competitive Conditions

January 25, 2013

With pressure to meet earnings and revenue targets, expand new markets and make the most of every resource, today’s global sales force is the difference between success and failure. Communication and online information are leveling the playing field, creating an extremely competitive environment and shrinking margins. Even the best products are one development cycle away from being leapfrogged in the marketplace. Competing on price is the path to becoming commoditized and to being robbed of the ability to present a unique value proposition. Ultimately, it’s your sales people—and their skills and experience—that will help you differentiate yourself, your solutions or your company in a highly competitive selling environment. Watch as Mladen Kresic discusses negotiation…

Negotiation Examples: Managing Internal Conflict

January 4, 2013

Not all books on negotiation skills cover how to handle internal dissension or conflict during important negotiations. There’s a reason we included it as the third of K&R’s Six Principles™ of Negotiation: A team divided is a costly team. Here is an example of how one of our seasoned negotiation consultants, “Hank,” handled a very difficult situation with a member of his own team before joining us at K&R. Hank’s client had put together a strong team to negotiate a deal with an Israeli company. This was one of his client’s biggest deals ever in the country; huge commissions were riding on it. The client had a local negotiator in Israel who was very talented, but also very strong-willed. We’ll call him “Attila.” As a result of his inability to be flexible when…

International Negotiation: More About Preparing to Win

December 14, 2012

In our previous post on international negotiations, we discussed the critical importance of preparation and gathering facts. You can’t control all the factors, but you can control your knowledge base. The bigger that base is, the higher the chances for success. As noted before, your charge as an international negotiator is to conduct thorough background work on everything that could impact your potential deal. This includes trying to account for cultural influence on business behaviors, regulations unique to that country, and more. Here we will suggest information sources that will widen your knowledge base and make you a more credible negotiator. In some cases, access to these sources may be limited due to considerations of distance or protocol. Watch as Mladen Kresic discusses…