Determine what you are really 'negotiating' and why
“Jeffrey, teach me about negotiations!”
“Well, because my prospects always want to negotiate the deal.”
No, they want to negotiate your price.
Reality: People who want to negotiate your price are in reality negotiating your profit. Any time the word “negotiate” appears in a sales situation, it means both your price AND your profit are going down.
Rethink negotiations: Where’s “value negotiation”? Where’s “customer profitability negotiation”? Where’s “customer productivity negotiation”? Where’s “customer improved morale negotiation”?
Uh, they’re nowhere. That’s because negotiations in sales have “lower price and loss of profit to the seller” at their core.
Negotiation “tactics” are something every weak salesperson must learn.
“Negotiate” means that you:
**Have failed to reach the real decision maker.
**Have failed to prove value.
**Have failed to differentiate yourself from the competition.
**Don’t have any relationship built up.
**Don’t have a past history of success or testimonials from other customers who paid the price and reaped the rewards of ownership and must negotiate (aka: lower) your price.
And you’re usually negotiating with purchasing, or procurement, or some third-party buying group that does not care about quality or value.
What’s worse? There are negotiation courses offered. The airline magazines are full of them. They beckon weak salespeople like the Sirens did to Ulysses’ men: Come, hear sweet sales music, and you too can lower your price in front of non-decision makers. Come and spend a few grand, and take the overpriced three-day manipulative negotiation course so you can enter your next negotiation and really lose some money.
The courses try to teach you to go for weakness and pain. I look for strengths and pleasure. I’m not interested in trying to “save my client money”; I want to make him or her or them a profit — and make a profit for myself. How about you?
I want a long-term relationship that necessitates both sides winning, so that the customer wants to win again another day. This creates loyalty, not an adversarial position.
And salespeople go to these negotiation courses by the thousands thinking they’re going to learn some trick, shortcut, or mental manipulation to win the sale.
Hello! What about the profit?
Wow — and all this for just a few grand of tuition, plus travel, and three days out of the field. Brilliant! Sign me up!
Which would you rather do? Negotiate, find pain, find weakness, try to manipulate, save money and lower your price — or would you rather look for pleasure, build a relationship, uncover profit and build strengths?
Would you rather “hammer out a deal” where no one really wins, or provide value such that the customer will pay your price and both parties win?
What do you think the CEO of your prospect or customer wants? Hint: They want value, productivity, morale and profit. And why aren’t you calling on the CEO in the first place? Why are you calling on some price-driven jackleg in purchasing?
You may make the argument that there must be something to the course; look at how many salespeople have taken it. Easy answer: lemmings.
Still want to take the “How to negotiate like a pro” course?
Here are the “means” of negotiation:
Negotiation means you have failed as a salesperson to prove value beyond price.
Negotiation means you are calling on a non-decision maker.
Negotiation means you failed to get to the real decision maker.
Negotiation means loss of profit.
Negotiation means you failed to create a buying atmosphere.
Negotiation means you failed to differentiate yourself from competition.
Negotiation means you failed to establish a relationship that is not based on price or bidding.
Negotiation is about price, losing something, or giving up something of value so you can make the sale.
Answer: If you want to negotiate, do it before the selling or bidding process. Set criteria for the qualifications of bidders. Change the terms of the RFP so that you become a favored vendor. Or better, eliminate the competition. That’s negotiation.
Better answer: Use testimonials to eliminate negotiation. Back up all claims and value offerings with customer video testimonials.
Think about this: Every dime you take off your price comes right off your bottom line.
Free Git-Bit: If you must negotiate, I have a few guidelines to help you. Go to www.gitomer.com, register if you’re a first-time visitor, and enter the word NEGOTIATE in the Git-Bit box. Jeffrey Gitomer can be reached at (704) 333-1112 or e-mail firstname.lastname@example.org.