Start-up entrepreneurs are not at all times the best negotiators. Sure, for some small business owners, negotiation comes naturally. Think of those that began negotiating allowances and extra TV time with their parents at the age of 4.
However, for most of us, developing negotiation skills comes from effort and experience, not formal education. Fortunately, as Denise Louise Jeffrey writes, “negotiation is a skill that can be learned with a little practice, preparation, and adaptability.”
Starting a business requires, literally, a whole lot of negotiations. Some of them are small, like ensuring you get the best price for printing your letterhead and business cards. Others are much larger deals that can make or break your startup right from the start. Sometimes you are the buyer; one other time a salesman. Either way, the skills needed to be a good negotiator are the same.
Here are 10 negotiation techniques that will help you change into a better and more confident negotiator on behalf of your startup:
- Prepare, prepare, prepare. Enter a negotiation without proper preparation and you have already lost. Start with yourself. Make sure you are clear about what you actually need from the arrangement. Research the other party to better understand their needs, in addition to their strengths and weaknesses. Get help from experts like an accountant, lawyer, or tech guru.
- Pay attention to the time. Time is vital in every negotiation. Sure, you have to know what to ask for, but even be sensitive to it When that’s what you’re asking for. There are times when it’s price moving forward and times when you have to attend. When you look your best, it is time to push for what you want. But watch out to not push too hard and poison a long-term relationship.
- Leave your ego behind. The best negotiators either don’t care or they do not to point out they care about who gets the credit for a successful transaction. Their talent is to make the other side feel like the final agreement was every little thing their idea.
- Improve your listening skills. The best negotiators are often quiet listeners who patiently allow others to talk while they make their case. They never trouble you. Encourage the other party to speak first. This helps establish one of the oldest maxims of negotiation: whoever says the numbers first loses. While this is not at all times true, it’s generally better to remain quiet and let the other party act first. Even if they do not give you numbers, it gives you a likelihood to ask what they think.
- If you don’t ask, you won’t get. Another rule of negotiation is: (*10*) As a part of your preparation, determine your highest level justified price. As long as you can argue convincingly, do not be afraid to aim high. But no ultimatums, please. Take-it-or-leave-it offers are normally misplaced.
- Anticipate compromise. You should expect concessions and plan for what they is likely to be. Of course, the other party thinks the same, so never accept their first offer. Even if it’s better than you expected, practice your best expression of disappointment and politely decline. You never know what else you might get.
- Offer and expect commitment. The glue that keeps a deal from falling apart is an unwavering commitment to follow through. You should offer this level of comfort to others. Similarly, avoid transactions in which the other party shows no commitment.
- Don’t worry about their problems. In most negotiations, you will hear all of the other side’s problems and the explanation why they can not give you what you want. They want their problems to change into yours, but don’t allow them to. Instead, address each one because it arises and try to resolve them. If, for example, their “budget” is too low, there could also be other sources from which they may raise money.
- Stick to your principles. As an individual and business owner, you likely have a set of guiding principles and values that you simply are not willing to compromise. If you find that negotiations are pushing these boundaries, it could be a deal you can live without.
- Close with confirmation. At the end of each meeting (even if no final agreement is reached), summarize the points discussed and any areas of agreement. Make sure everyone acknowledges this. Follow up with appropriate letters or emails. Don’t leave any loose ends.
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Our summary of negotiation techniques
When it involves the entrepreneurial talents that ensure success in the startup world, the ability to barter well is one of the most significant traits you can have. Make sure you develop your negotiation strategies. Some people think they are good negotiators, but in reality they are not. From attracting good people to arranging financing or executing your first big deal, sound negotiation techniques will be essential.