This week, Franchised Food Company CEO Stan Gordon shares his views on negotiation, and how you can better your skills. Check out his thoughts below…
No matter what size your business – part of being a good operator is having strong and effective negotiating skills.
My varied experience in business has taught me that having the determination and drive to reach your ideal outcome whatever it may be, not only helps you secure good deals, but can improve a number of aspects of your business, even your day to day interactions.
And, while not all of us is cut out for negotiating, it’s imperative that you bring people into your business that are experts at brokering a good deal. Like I always say, you’ve got to play to your strong points and build a solid and diverse team around you.
In contrast to popular belief, you don’t have to be (nor do you want to be!) a sleazy car salesman or schmick real estate agent to cut a good deal. Here are my top pointers on how you can get the most ‘bang’ for your buck, without confrontation or burning bridges.
1. Pick your targets
So, you’ve established a need for something: a new business site, an additional staff member or purchasing some new equipment.
First things first: ask yourself if these situations lend themselves to negotiating. Sometimes they won’t and that’s ok, but it’s being able to spot the opportunities for negotiation and work them to your advantage that is important.
Be realistic with your approach to negotiating. Purchasing a can of Coke at your local convenience store is generally not a negotiable opportunity, but buying 100 cans might enable you to discuss a small discount.
Choose your targets wisely and be smart about which of them you talk to. You’re not likely to get anywhere in a retail environment if you start a conversation with a junior staff member – there’s just too many hurdles for them to jump over. Head straight for a store manager or business owner; they’ll have a lot more say about costs and will therefore be more willing to offer you a deal.
2. Do your research
Be proactive and seek answers!
Not everything you do in business is negotiable, so before you head in hard think about the bigger picture. Consider past experiences and what has been the result in similar situations; use your knowledge and experience to help guide you.
Perhaps you can purchase a similar item from a variety of different outlets? If yes, start your negotiating process early by checking out competitors, comparing prices, quality and overall value for money. This may just mean you have to do less back and fourth in the flesh, to get your ideal price.
3. Enter armed and ready to go
If you stop and think about it, negotiation happens all day every day. You discuss with your partner about the TV program you’re going to watch or the restaurant you’ll dine at for the evening. They may seem like insignificant choices, but you’re practising your negotiating skills without even realising.
The key to successful negotiation is preparation, so utilise this experience!
There’s no point rocking up to a car dealership to purchase a new car if you haven’t got a rough purchase figure in mind. Think about key factors like the actual price of the car versus what you’d be happy to spend, as this can help you set a goal and in turn assist you in achieving a suitable outcome.
Before attending an auction or looking to purchase an expensive item, rehearse different scenarios so that when it’s time purchase or make an offer, you can negotiate confidently.
4. Be flexible
Let’s be honest, everyone loves a bargain… but make sure you’ve got your head screwed on.
Rather than an argument, create a cooperative conversation. You’re more likely to reap the rewards if you’re personable and able to show respect to whomever you’re dealing with, and in turn they will be more inclined to listen and make considerations for you.
Negotiating and asking for a discount can be awkward, but if you’re realistic in your expectations and know when to call it quits you can avoid sticky situations… and ultimately get what you want!
