The person who needs the deal the least has the most power in a negotiation. If you can’t afford to walk away from a deal, no matter how bad it is for you, then you have no power with which to bargain.
The first and most obvious way to retain that power is to build a pipeline that protects you from having to negotiate in a way that allows your client to underinvest in the results they need or one that causes you to lack the investment necessary to deliver the results you promise. Building that pipeline should be something you do as a matter of course, but there are other things that you can do to level the playing field.
You can also create a preference to work with you, your company, and your solution. There are a lot of ways that you can create a preference, as many ways as there are deals, in fact. By creating a preference, you increase your strength in a negotiation by creating leverage, namely by creating a scenario where your dream client must choose between you and something less than you.
If you want to create greater leverage, you wire the building. You gain the consensus of the stakeholders who are going to either work with you—or work with someone they believe to be inferior to the experience they would have working with you. It might be easy to say no to you, but when you build consensus, the other party has to say no to you, to the people who need your help, to the leadership team who prefers you, and the people who have already spent time deciding that you are their choice.
You can also be candid and transparent enough to have a conversation about what you will and will not be able to do in a negotiation. You can ask the stakeholders who prefer you to help you protect the investment in the results that you need them to make in order to give them what they want or need. You might also be transparent enough to share your model and explain where your prospect’s investment is going to go, how it benefits them to make that investment, and help them justify the delta between your price in the target they are trying to negotiate.
If you want to level the playing field, you must do the work.
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Filed under: Sales Acumen