The goal of any sales conversation is revenue. Yet, unlike the past where customers did not have much access to information, today’s sales reps are dealing with customers who are empowered and are highly sensitive to risk. This means that apart from an excellent pitch and stellar presentation skills, sales professionals must have matching negotiation skills to help them take charge of the process and close deals with desirable pricing and terms.
It is paramount that you prepare adequately before engaging your prospects to negotiate a sale. This means having in-depth knowledge of the industry so that you can easily justify your pricing. If the products or services you are promoting fall on the higher end of the spectrum, then you must have reasons that quantify why your product is superior to your competitors.
Even more important, you need to prepare an initial price that will kick off the negotiation. Ideally, this must be a higher amount than the actual price you are willing to sell the product or service because as you negotiate, you will end up lowering the price. Knowing the lowest possible price you can sell is important as it ensures you maintain profitability. As part of your preparation, it will be interesting to know what the customer’s past experiences are with other vendors as this can help shape your pitch and give you confidence.
You need to be transparent when communicating with the prospect. This means clearly stating the terms of your contract, product features, cost of ongoing maintenance if any among other things. One major pitfall that could ruin your negotiation process is the failure to mention hidden costs. Apart from the logistical issues, make a point of emphasizing the value of the product of services. Clearly explain how the value justifies the price and how the product will benefit the customer. In cases where you’re offering a discount, be sure to state that it is special pricing with no strings attached as the customer will get to access the same features. Allow the prospect to ask questions and seek clarifications.
Negotiating a deal can sometimes turn into a heated discussion. You have to remain respectful to your prospect while always maintaining a healthy relationship. Remember, sales negotiations require concessions. Given that only a small percentage of leads hold the belief that sales reps understand their needs, you must be a good listener. Actively listen to what the prospect has to say to prepare appropriate responses and solutions to the issues they may have. Listening actively also helps you to practice empathy while keeping the customer at the core of the conversation.
Create a Sense of Urgency
You need to state clearly the timelines in the course of your sales negotiation process. From the time you are setting your first pitch to making follow-ups, you need to set a deadline for closing the deal. Having this negotiation skill often helps to build momentum for your negotiations while also helping you to close the deal because most people have the fear of missing out. Even then, be realistic with timeframes by providing ample time for your leads to arrive at a well thought out decision. Be careful not to make the prospect feel rushed because they can easily back away from the deal.
Be Willing to Give and Take
Compromise is not only part of a sales negotiation but an equally important negotiation skill. Negotiations are not one-sided. Therefore, your aim should be a collaboration with the lead in achieving the best deal that favours both of you. Be strategic so that you counter offer a deal that is likely to deduct offerings of the product without taking away what the client is looking for. This often makes the sales process lengthy. However, since you want both you and the client to be happy without getting the business to sign off more value than the client is paying for then it is worthwhile. Thus, it is important to have a clear understanding of your limits before meeting the potential customer. Although negotiations can go any way, having the right negotiation skills means you are well prepared to stay in control and close a deal. After all, when entering a negotiation, your goal should be to settle for a win-win for you and the client while at the same time laying a foundation that will turn the customer into a raving fan.