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3. Just Before We Get Going . . .

Some Golden Rules

AT THE CORE of negotiation is learning how to communicate well and find out what the other person wants to get out of the deal. If they are not familiar with negotiation they may not realise that it is always possible to work together to find a deal that everyone is happy with. (It just takes a lot of tact and perseverance sometimes!)

1. Listen

You need to be a good listener. Give the other person time to talk and don’t be scared of leaving gaps in the conversation. Sometimes people fill the gaps with conversation and give things away about themselves or their company that are useful to know.

The aim of listening well is to find out what is important for the other person. For example, you need to know if it would benefit them to have a payment in the following tax year, or if they do or don’t have cash flow problems. If you can find out how easily they deliver, if they pay other people for delivery or deliver themselves – all these types of things add to your knowledge base, and allow you to propose terms that make things more tempting for them.

2. Communicate clearly

It is important to remember what you have said during your conversations, to keep a note of this and not to change your mind at a later stage. Always be sure that you are comfortable with what you are offering. Repeating it is fine. But you can’t keep changing your mind.

When you are communicating there are some particular words that are helpful to use (and avoid) which I will cover later in the book.

3. Ask questions

Do ask questions! You will have realised by now that it is very beneficial to find out as much as possible about the company and people you are dealing with.

It is useful to couch some financial questions around easier, friendlier ones first. Always write down what you would like to find out before you pick up the phone, or make a visit.

For example, if you would like to find out if a company is relatively stable:

 start off by telling them a bit about your circumstances, in a friendly way; try to engage the person on the phone

 ask them what their company is like, how long they have been around

 ask them if they have been working there for a long time

 ask them where they are based

 ask whether you can go and see them.

Share some information about yourself as you go along. When you are further into discussions, ask why they have offered you a certain price, or why they are not interested in giving a discount if you take some of the delivery later in the year (for example). You can learn so much and get some ideas of your own.

Building a long-term relationship with your client or supplier is really important, so be friendly with your questions. If possible, go and see them and have a chat over coffee. Share your own experiences with them.

4. Become a negotiator

Never say yes to something straight away. There are a couple of reasons for this. The first one is that it’s always useful to go away and think about an offer. You may have forgotten something. The second reason is that both of you want to feel that you have got a good deal – if you bite someone’s arm off at their offer they will immediately suspect that they should have charged more.

Never give something away for nothing. In other words, don’t agree to a higher price or don’t agree to accept something (e.g. an additional amount) in order to get the deal closed quickly. Always ask for something in return.

QUICK TIP: If you would like to accept something, remember to use the word ‘if’. ‘If I pay you 50% up front, what can you do for me?’ or ‘If I accept that price, what can you do to help me with deliveries?’

5. Build relationships

Developing a lasting business relationship is a key goal of negotiating. When you have some strong partners in business, your life will be much easier. Always bear in mind that if you construct a deal that both parties are happy with this is a good building block for future deals, and you are likely to do more work together in the future.

If the deal you are doing is definitely a one-off opportunity and there is no chance you will work with the company again, these rules don’t apply, and you should go for the highest price you can! (This is not really negotiating.)