Negotiations are always a high-stakes, high-pressure period for salespeople and prospects who both have serious skin in the game.
Each team involved may have their own conflicting agendas. As a result, it's unlikely that every person at the bargaining table will walk away with exactly what they wanted.
Negotiation breakdowns in sales can happen for a number of reasons, including poor communication, short tempers, and sudden changes in an established plan.
Here are some strategies to avoid losing deals when negotiations go sideways:
Consider Integrative Bargaining
Historically, most sales negotiations have taken place with reps and prospects both holding their cards close to their chests.It's common knowledge that the less you let prospects know about you and your interests, the fewer weaknesses they’ll be able to exploit. In turn, you’re more likely to close the deal with your terms.
However, this approach is often counterproductive. Going into a meeting with an unyielding attitude can make both parties so guarded that compromise becomes impossible.
To avoid a stalemate, shift your strategy by using integrative bargaining.
Integrative bargaining teaches you to stop viewing sales deals as a zero-sum game. It highlights the importance of looking for win-win situations for both you and your prospect. The core idea is simple: the more information you and your prospect reveal about your interests, the more value you are able to create for each other.
You may not get exactly what you came for, but you’ll end up with more than what would have been possible if you’d taken an inflexible, hardline stance.
Avoid Worst Case Scenarios
While it’s important to look for ways everyone can be satisfied with a deal. It’s equally important to consider what you are willing to lose or give up if things go wrong. Whenever you enter into an agreement, you’re also agreeing to a set of consequences if the terms aren’t honored. Enforcing those consequences can be a risky and time-consuming process.
Taking legal recourse is very expensive and companies never know if they’ll actually win. It can also sour relationships with customers. The result? Very few businesses choose to legally enforce the legal aspects of their contracts.
For that reason, it is helpful to perform a full cost–benefit analysis of the legal proceedings that might come with a breach of any contract that you’re negotiating. You can ask yourself questions like:
- What are the likely costs of litigation?
- Will the benefits of winning a lawsuit outweigh litigation costs or vice-versa?
The more you can learn about potential litigation ahead of time, the more realistic you can be at the negotiation table.
Avoid Outright Hostility
Though you’ll want to be honest with prospects about your legal rights in the event of litigation, you don’t want to make threats. In fact, you should avoid tones that sound forewarning or emotional whatsoever.
Remember, the prospect has agreed to negotiate with you and have certain problems they’re hoping a new deal will solve. You’re unlikely to find out about their pain-points by fighting. Without that knowledge, it’ll be very difficult to identify how your product can provide a solution to their problems, map your solution to these problems, and close the deal.
Balancing Hard Negotiations vs. the Relationship
It might seem like you have the upper hand by dominating a negotiation but there are very few instances in the sales world where you can sign a deal and never interact with the prospect ever again.
Chances are, you’ll be doing routine check-ins to maintain relationships and build rapport with your clients. Lasting customers bring in more benefit than a one-time partnership anyway, so it’s important to weigh the deal on the table against your relationship with your prospect.
Even highly-trained salespeople sometimes have to remind themselves of negotiating fundamentals during particularly intense deals. If you sense things starting to slip during a negotiation, quickly check in on how you’re presenting yourself and take a look at some of the best negotiation training resources.
Remember to ask yourself:
- Are you a person who seems willing to reach a compromise by discussing mutual benefits, or are you unwilling to give an inch?
- Do you care about your future relationship with the prospect, or do you view them as a means to an end?
By keeping these questions in mind and adjusting your behavior, you may find that the tables turn more easily.