By Princess Jones
One of my favorite things to do with my husband on the weekends is to go to flea markets. I love to find hidden gems and Hubs loves to haggle. That’s a good thing because haggling is not really my thing. I like it when the price is the price, and I can just make my decision.
On the other hand, as an entrepreneur, I’ve had to learn to negotiate on a nearly daily basis. From subcontractors to vendors to customers, almost every transaction involves some sort of negotiation whether you realize it or not. And if you’re one of those people who aren’t a natural negotiator, here are some tips to help you work on your skills.
Assess the Situation
The first question you have to ask yourself is if haggling is appropriate. For most business situations, there’s nothing wrong with massaging the terms until you get what you need. Your interactions with your vendors, your employees, and your customers are all fair game.
On the other hand, that Girl Scout selling cookies is selling cookies for a good cause and doesn’t have the power to change the pricing. Instead of looking smart, you’ll look cheap and ridiculous.
Put on Your Game Face
If you’re coming to haggle, you need to come with your game face in place. If you seem too eager or enthusiastic, you are putting yourself at a disadvantage at the start. You should always appear ready to walk away from the deal at any moment.
Also, how you show up to the negotiation is important. The day you meet your partner to negotiate down your stock options is not the day to drive your Ferrari. You may think “I drive this Ferrari every day. They’ve seen it. They know I have it. It won’t have anything to do with our conversation today.” But optics make more of a difference than you think.
I know a chef who owns his own very popular restaurant and buys his produce fresh each day. Although he’s a successful entrepreneur and most of his vendors would recognized the name of his restaurant, he shows up in the same ratty jeans and tee shirts he wore when he was starting out.
As a straightforward person, I used to always put my final offer on the table first. I figured that I was saving time by starting with where I wanted to be. What I realized is that hagglers like to have room to move. So they would take my final offer as a starting point, even if I made it clear I didn’t want to haggle.
It’s so important for both sides to feel like they are getting something out of the deal. By giving the negotiations room to move, you’re lubricating the situation. Now I go into a negotiation knowing where I want to land, but my opening offer is always a little lower than that.
Tell Them What’s In It For Them
Remember when I said that it’s important for both sides to feel like they got something out of the deal? Well, not only do you have to make the deal sweet for the other party, be sure to tell them what they’re getting out of it.
Let’s say that you’re trying to get a twenty percent discount on a monthly bill from one of your vendors. In exchange, you can offer to pre-pay instead of using your usual thirty net payment. The vendor gets income faster and you save a chunk of money. That’s a win-win situation.
Put a Deadline on It
You ever wonder why every time your favorite retailer offers a sale, it’s only for a limited time? It’s because putting a deadline on the offer pushes you to make a decision quickly. If you have more time to think about it, you might decide that you don’t need that purchase after all.
Your negotiation is the same way. Some situations have natural deadlines, like buying vegetables at a farmers market. But if there isn’t a built-in deadline, you need to create one. Let’s say you’re negotiating with a potential freelancer on their fees. Instead of just letting them take their time, say something like “I’m considering some other candidates as well so if I don’t hear back from you by the end of the day tomorrow, I’m going to go with one of my other options.”
If you’re haggling with your supply vendor, do it close to your next order date. If they’re expecting your payment in two days, they’re probably already counting that income and will be motivated to make that happen.