By the team at Bizcrowd
Have you ever left a negotiation feeling like you gave away too much? Or perhaps you didn’t get everything you wanted? Successful negotiating is a key skill for SMEs — especially when they may be dealing with much bigger businesses. Whether establishing the salary for a new recruit or getting the best from a supplier, these tried and tested negotiation tactics can help you get what’s best for your business.
Make a great impression
The Journal of Applied Science reports that the outcome of a negotiation is predicted in the first five minutes. This is because the other party is trying to size you up and establish whether you’re over-selling, bluffing or nervous so they can negotiate accordingly. Great negotiators should use this crucial window to build a rapport with the other side and set the tone to lead the negotiation. Be strong and hold your poker face through this initial scrutiny and you’ll have more chance of getting what you want in the long run.
Ask for more than you expect to get
Great negotiators are optimists. It sounds obvious, but by asking for more you might just get it. Alastair Grant, founder of Alastair Grant & Co and teacher negotiation skills at Cass Business School, London believes in going in high. He says: “It raises the value of what you’re offering and gives you room to negotiate.” This crucial room for maneuver means you can still fall back to a comfortable position when the other side delivers their counter offer.
Advice from Harvard Business School suggests that being the first to go in with an offer can help you achieve the desired result. The reason for this is ‘anchoring’. A high first offer psychologically anchors the price, preventing negotiators from making drastically lower counter offers. If you don’t get to make the first offer, don’t be afraid of making an aggressive counter that dislodges the anchor. Being aware of anchoring will enable you to overcome it.
Flattery will get you everywhere
Jennifer Chatman of the University of California experimented to find the point at which flattery stops working. Shockingly, she discovered it doesn’t! Skilled flatterers will stick to believable praise based on the attributes and achievements of others rather than sycophantic sucking up. It might be a fine line to walk, but employing a little believable flattery can build a rapport and improve your chances of success in a negotiation.
Be promotion-focused not prevention-focused
Focus on your goals and how to achieve them rather than how you can prevent failure. A study by Adam Galinksy at the Kellogg School of Management found that promotion-focused negotiators achieved better outcomes than prevention-focused ones. This is because promotion-focused negotiators spend more time thinking about what they want and how to achieve it than wasting energy worrying about failure.
Never jump at the first offer made. Whether you’re buying or selling, holding back will encourage a better deal. Psychologically this also ensures that both parties leave the table feeling positive about the result. Alastair Grant founder of Alastair Grant & Co and teacher negotiation skills at Cass Business School, London explains: “If you accept the first option there’s the possibility that both sides go away thinking they should have tried to get a better deal.”
Watch your body language
Body language can play an important role in your negotiations. The ‘chameleon effect’ or mirroring has been found by multiple studies, including one by New York University, to increase a sense of rapport, so a little chin touching and synchronised nodding can go a long way to building relations. However, be warned, the University of California - San Diego found that too much copying can be counter productive.
Read your opponent
While you’re paying attention to your own body, don’t forget to keep an eye on what the other side is doing. According to Psychology Today neck-touching is a sure sign of stress, while Professor of Psychology Susan Krauss Whitbourne, advises that leg bouncing or foot-tapping are obvious giveaways of nerves or irritation. These non-verbal messages will let you know how the other side is really feeling and give you a genuine sense of how confident they feel about their offer.
Be willing to walk away
Depending on a positive outcome puts you in a dangerous position. Negotiation expert and bestselling author Ed Brodow is so convinced of this principle he calls it “Brodow’s Law”. The rationale here is that if you can’t say no, you might make too many concessions for the sake of striking a deal. Always be prepared to walk away if you can’t agree on something that works. When the other side knows you’re willing to leave with nothing it puts pressure on them to meet you with an agreeable offer.
Preparation is key
As the saying goes: “Proper Preparation Prevents Poor Performance”. According to research by Negotiation Resource International, 62% of people spent just an hour preparing for their last negotiation. What’s more 68% of those questioned believed better preparation would have led to a better outcome. The message is clear: do your homework! Get to know the other side and prepare a list of your goals for the meeting. It’s also helpful to work on a list of open questions to ask in the negotiation itself.
Information influences people’s decisions. So use this to your advantage when you’re next negotiating. Professor Gita Johar of Columbia Business School argues that ambivalent or undecided people are easily influenced by information. So bombarding a person with facts adds to your powers of persuasion. The more information you give, the more chance you have of quashing ambivalence and striking a deal.
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