The art of negotiation: Does everyone win?
Monday, August 29, 2011/
Over the past four years growing Job Capital I have been involved in countless negotiations. Monetary, services, staff requests, client requests and of course with myself.
I was thinking about what makes a great deal, what really makes a great negotiation work, or not.
Firstly I believe that everything should cost me nothing, and I should be able to charge a premium for my services. That’s an ideal world right? If we ran our businesses at no cost, everyone worked for free and we charged premium pricing for everything we provide.
This is of course, far from realistic. Especially since the taxman takes his fees along the entire journey as well.
Negotiating is an everyday occurrence in business. Sometimes it’s a huge deal, sometimes a very small transaction. Either way I always refer to a few principals (of course there are countless scenarios and variables):
- If you want to close the deal, keep it from folding. Don’t let things drag out forever, until eventually the momentum is lost and the significance has changed as both parties are now onto the next big deal.
- Make sure the negotiation is with the right decision-maker – I only want to go through it once with the right stakeholders.
- I always start with my end result in mind, I know my bottom line, operating costs and I know the resources required to deliver for a client and also make a profit.
- I always do my due diligence prior to the process of negotiation so no one’s time is wasted.
- Always be fair if you want fair. A win/win is far better all round. Who likes to walk away feeling screwed and then feel like they are delivering to you begrudgingly
- I have no issue saying no.
- I like to negotiate with ethical operators. They get far more business than those that produce “surprises later”.
- There are certain things I never compromise on, and that is my values and the business values.
- I will pay fairly for quality when I need quality and longevity.
- Just because someone else is cheaper, doesn’t mean they are better. Also doesn’t mean they are not.
- I support Australia however I can by way of supplier – software, accounting, IT, etc.
- Be pleasant and be approachable – you get more bees with honey.
Most importantly, once the deal is done, I deliver and expect delivery. The deal doesn’t stop when the invoice is raised and the money paid (either way). I want all of our customers, suppliers and partners to refer us to other suppliers, customers and partners and to have this, I am always conscious of making sure the business and the team do exactly what is expected to do in the execution of a deal. Otherwise what’s the point of all that negotiating?! Plus it can have an effect on your brand, business reputation and personal industry image.
I have found I deliver far more in a deal if I feel like I have won; likewise I get amazing delivery if my counterpart feels the same.