Negotiation is a fundamental part of international trading. You will have to negotiate every part of the deal with suppliers, wholesalers, retailers, pricing and terms of delivery. Understanding how to negotiate is one of the cornerstones to making your business successful.
Below is our 5 Key Steps To A Successful Negotiation:
Important!: Many deals are negotiated based on matching personalities, not cost alone. If you can find something in common and personalities work well, this can seal the deal.
Step 1: Defining Objectives And Targets: Start with preparing your “L-I-M”.
1. Recognizing the objectives you would LIKE (L) to achieve. What does the perfect deal look like to you?
2. Identify what objectives you INTEND (I) to achieve.
3. Finally, recognize the MINIMUM (M) you’ll accept.
Step 2: Setting The Negotiation Strategy.
Are you working towards a Win-Win or a Win-Lose strategy? A win-win leads to collaboration, mutual interest, flexibility, joint problem solving and harmony between the parties, a good strategy for a long term relationships.
A win-lose strategy can lead to conflict, inflexibility, competition, one side beating the other and adversarialism. This strategy can be used in one-off deals.
Step 3: Active Listening: Concentrate on what is being discussed. Don’t answer back or interrupt. Try to understand the other persons point of view and don’t jump to conclusions.
Step 4: Methods Of Persuasion: One or several of the following methods of persuasion can be used. Logic, bargaining, emotion, even threats and of course, compromise. It is up to you to select the correct one(s) for a particular situation.
Step 5: Your Style Of Negotiating: Find your own style. Warm, tough, logical, personality driven perhaps. Recognize these traits in the other party and respond accordingly.