How to negotiate a sale


Checklist

  1. Before the negotiation begins, prepare yourself; aim to appear keen to do the deal, but not desperate.
  2. Clarify your objectives (eg price, volume, or a quick sale) and how important the deal is to you.
  3. Find out what the customer wants. What features or extras do they value, and what are their priorities - price, service or delivery?
  4. Research the customer's position: how urgently they need your product, what they can afford and what alternatives the competition are offering.
  5. Assess the value of your offering to the customer: what benefits it offers, what problems it solves for them, what alternatives it replaces.
  6. Identify the strengths and weaknesses in your proposal and plan your strategy; aim to reach a deal which will suit the customer as well.
  7. Decide what could be negotiable; try to identify concessions which would cost you little but which the customer would value.
  8. Consider the potential impact on other deals and other customers of any concessions you make.
  9. Clarify your terms and conditions from the start of the negotiation.
  10. Pitch your opening price high; explain how the value in what you are offering justifies the price.
  11. Agree what the negotiating points are.
  12. Concentrate on asking questions and listening; fend off questions aimed at discovering your own negotiating position.
  13. Test the strength of any concessions the customer asks for; ask whether they are deal-breakers, or what alternatives there are.
  14. Look for reciprocation on any concessions you make: for example, an increased order size in exchange for a discount.
  15. Summarise each point as it is agreed; shake hands on the deal when all the points have been covered, and follow up with a written agreement.

Cardinal rules

Do:

  1. find out what the customer wants
  2. decide in advance what areas you are prepared to negotiate
  3. ask questions, and listen
  4. aim for reciprocation on any concessions
  5. confirm the deal with a written agreement

Don't:

  1. make concessions from the start
  2. reveal your negotiating position
  3. throw in extra concessions for nothing

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