Negotiation is part of life and business. For the entrepreneur and small business owner looking to succeed in business, having negotiation skills is important. Negotiation skills is essential in achieving scale and critical to the success of any business venture.
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Value is gotten and added for a business on the foundation of negotiation. You need negotiation skills to get labour, clients, suppliers, etc. Basically, you need to negotiate your way to success in business and life. Without a negotiation skill, you always lose out.
Therefore, the need for an entrepreneur especially small business owners to possess negotiation skills cannot be overemphasized. This is an even more important skill to possess at the early stages of the business. Often, small business owners settle for less or lose customers because of the lack of this important skill.
Negotiation skills foster the growth of small businesses and aids in relationship building. You can build a network of loyal clientele when you master your negotiation skills.
In negotiation, small business owners should be aware that negotiation is anchored on two essential things; the value of the business and relationship building.
The Value of The Business
The best negotiations are those that put value and relationships as the focal point. Most entrepreneurs are overly concerned about making quick profits that they forget the value they bring to the table. Remember, if you don’t have anything to offer, nobody will be at the negotiation table with you.
Your value can be the quality of your product or service or something more tangible than those. In negotiating, the value should be emphasized by the entrepreneur.
Most small business owners make the mistake of letting a potential client undervalue their business worth. Consequently, they end up settling for less. By settling for less, you gradually build a reputation of ‘anything goes’ for your business in the business world.
Value here is also attributed to the entrepreneur behind the business venture. The entrepreneur not just his business must have integrity. This is part of the things you bring to bear at the negotiation table.
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Negotiation Is About Relationship Building
Negotiations should be viewed as an avenue to establish, build and nurture relationships. Before you enter into any negotiation, you must have a mind-shift; you should view the other party as a potential partner needed for your business success.
This approach changes the scenario and creates an enabling environment where values can be communicated, exchanged and agreement reached. In business, building relationships is key as it helps expand your network. As we know, your network is your net worth.
When you approach negotiation as though you are building a relationship, the relationships established can spin-off to other business deals. For instance, this established network can refer some other clients to your business.
You should also know that relationships are built on the foundation of trust. When you deliver on what is agreed, you are on your way to building a long term relationship that will impact your business success.
The business owner when negotiating should bear in mind that the choices he makes in negotiating contracts affect the growth of the business.
Therefore, in addition to communicating your business value and following the relationship approach to negotiation, the entrepreneur and small business owner should follow the following tips for a successful negotiation to happen.
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Tips For A Successful Negotiation
Small business owners neglect to research the other party before engaging in negotiation. They hide under the premise of being small. You don’t have to be a large company to do the right thing. Big organisations started small.
In researching your clients, suppliers, prospective employer and employees, etc, get to know their strengths, weaknesses, and behavioral patterns. Factors such as the client’s history, products, company information, competitors, market trends, etc, are essential in giving you an edge during the negotiation.
The results from the research arms the business owners and entrepreneurs with the knowledge to make assertive demands. Also, research helps the business owner to be well prepared and equipped with the right strategy to use during the negotiation. He will know when and how to compromise and when to be firm.
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Plan And Prepare
Part of the negotiation skill every entrepreneur should have is the ability to plan and prepare ahead of time. The results of the research should arm you with information to plan and prepare for the negotiation.
Without an adequate plan, you are likely to accept anything offered by the other party. During your planning stage, you should set the objectives for the negotiation.
Also, planning will help you identify your weaknesses and how to use them to your advantage. Additionally, planning and preparing will help you identify the weakness and strengths of the other party. You can anticipate the demands of the other party and prepare in advance.
Finally, planning helps you know when your objectives are not being met. That way, you know when to walk away to avoid wasting your time.
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Listening is an important negotiation skill for any entrepreneur. Unfortunately, we all want to be heard, but find it difficult to listen. Interestingly, when you listen and pay close attention to words not said, you will discover some of the facts you may have missed during your research.
You can identify some of the strengths and weaknesses of the other party when you listen. Also, by listening, you can gather points that will help you build your argument and get the most out of the negotiation process.
Also, you can get a clue about the kind of person the other party is by listening. That way, you can decide if you want to deal with them or not.
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In negotiation, communication is a key factor. You have to communicate your view and follow that with a letter of intent. Every time you meet, you should have what was agreed on in writing. This will save you time and help in reducing the negotiating time.
When negotiating, ask relevant questions and don’t give away anything without getting something in return. If you continue to concede, without requesting something in return, the other party will continue to ask for concessions.
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Time Is Of The Essence
In your communication, ensure that you don’t give the vibe that you are desperate. In negotiation, the person who seems to have more time on their hand always has the upper hand.
Once the other party senses that you’re not in a hurry to make the deal, chances are, that they will make concessions that will make you say yes quickly.
Always keep this in mind, they are in the negotiation table with you in the first place because you have something they need.
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Negotiate With The Right Person
Finally, before you start the negotiation, ensure you are negotiating with the person with the authority to make a decision. You will waste valuable time and be on the losing end in a negotiation if you negotiate with someone who does not have the authority to make a decision. They will always say, “I will get back to you”.
It can be frustrating and most negotiation experts know this and use this strategy as it gives them an advantage. They are not in the direct line of fire. So, ask questions and ask to speak to the person with the right authority.
In today’s business world, the ability to negotiate successfully can make the difference. It will determine whether your business fails or succeeds. Go out there and negotiate your way to success and never take the first offer. Always counter it.
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2 thoughts on “Tips For Making The Best Negotiation For Entrepreneurs”
Learning the art of negotiations can help you and your business grow significantly later on in your journey.
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