35 Negotiation Tips for High Value Sales

By Luke Heath for CareerCoacha

1.  Prepare 

Train to negotiate. Seek to know your customer’s temperament, motivations, and timeframe. Anticipate tactics. Role-play upcoming negotiations with colleagues. 

2.  Do not negotiate in fear 

If you have fear, do not display it. Do not talk about how tough business is. People do not want to do business with the desperate – except to gain a bargain. 

3.  Build perception that you have alternative customers 

The best way to negotiate without fear is to have a full sales pipeline. The sales process and negotiation are entwined. When a seller is perceived to have alternatives: buyers negotiate less aggressively; agreements are reached faster; and better prices and terms are achieved. 

4.  Be prepared to walk away 

Your position is strengthened when purchasers believe you are willing and able to walk away. Fully consider and value the ‘no-deal’ option before you negotiate. 

5.  Establish value before price 

Customers use price as a negotiation point because it is the easiest point of comparison. Establishing customer needs and your value proposition reduces the need for concessions. Know when to sell and when to negotiate in the sales cycle. 

6.  Understand your customer’s purchasing process 

Build allies and champions who can influence the buying process. Identify the main decision-maker(s). Increasingly, after the preferred supplier is selected, centralised procurement departments negotiate price and terms. 

7.  Select your negotiators 

For some large negotiations it is vital to use your best negotiators. At other times, a sales manager can undermine the salesperson by taking over the negotiation. Allocate negotiation roles and tactics beforehand. 

8.  Focus on common ground 

Prepare for areas of agreement as well as areas of dispute. Regularly summarise what is agreed. This builds a healthy negotiation climate and momentum. 

9.  Price confidently 

Preparation helps you to be more confident. In meetings, use a persuasive voice and positive body language. 

10.  Set high price expectations 

State your price and terms before the customer states their price and terms. This helps to anchor expectations and leads to a higher price. The exception is when the buyer ends discussion because the initial price is considered outrageous. 

11.  Be comfortable with silence 

Do not rush to fill the silence in a negotiation meeting. Some people make concessions to escape the discomfort and uncertainty associated with silence. 

12.  Concede discounts in small increments 

Buyers are more likely to accept a price when they receive two small discounts than one discount equal to the two smaller discounts. Discounting in smaller increments also permits acceptance to occur with less discounting. 

13.  State what the buyer might lose if they choose not to deal with you 

People are motivated more to avoid losses than to achieve gains. Whilst it is not persuasive to criticise your competitors, the above principle can be successfully used against them. Example: ‘the proposal from TravelCheap will not give you our 24/7 customer care hotline’. 

14. Refer to earlier agreements if it suits you 

Buyers are more likely to accept a price or term in a new agreement if it has been established in a previous agreement between the buyer and seller. 

15.  Draft the contract or agreement first 

In complex deals, the party that creates the first draft of the contact or agreement will have a strategic advantage. 

16.  Value your rebates, warranties, delivery times etc 

These are not entitlements for customers. Price their true value. Do not make concessions unless they have an impact on the customer. 

17.  Have main conversations in-person or by telephone 

It is easier to persuade customers face-to-face or by telephone. Email is reserved to confirm understanding and provide data. This significantly reduces time and keeps momentum going. If the customer insists upon receiving the email first, say: ‘I will email then telephone you in a few minutes to clarify.’ 

18.  Negotiate with emotional intelligence 

Recognise your emotions and the emotions of the customer and respond in a useful way. Check your ego. Your courtesy and calmness are usually rewarded. 

19.  Avoid irritators 

If you describe your proposal as ‘fair and reasonable’ it implies that your customer is ‘unfair and unreasonable’ if they do not accept. This annoys customers. 

20.  Wait before responding with a counter-proposal 

The buyer is often at their least receptive to a counter immediately after they have tabled their proposal. Listen and take notes. Wait. Show that you have considered the buyer’s proposal before you counter. It is often useful to say you will respond in forty-eight hours. 

21. Think creatively about the customer’s problem(s) 

Skilled negotiators consider a wide array of options. Example: if the purchase would exceed the buyer’s budget for this year, consider deferring part of the invoice until next year. 

22 Maintain momentum 

Good prospects are often very busy. Be mindful of scheduling times to advance negotiations. Buyers can go cold, have their budgets cut, have key staff leave, or alternative suppliers emerge. Stay focused on getting the deal done. 

23. Beware of skewing incentives for your salespeople 

Sometimes sales incentives are skewed to revenue rather than margin. This might lead salespeople to neglect profitability to get volume done. 

24. Use fewer reasons 

Use your best reasons. Lesser reasons can be more easily rejected, weakening the overall persuasiveness of your case. 

25. Timing presentation of reasons 

If the issue is of strong importance to the customer, provide reasons or justifications early in negotiations. If it is of low importance, present reasons later. 

26. If your reasons are strong 

Speak slowly, avoid being overly technical, provide a written explanation, and avoid negotiating when the customer is distracted. 

27. Investment in the negotiation increases acceptance 

A buyer is more likely to accept the seller’s price and terms if the buyer has invested significant time and resources in the negotiation. The seller facilitates this by uncovering buyer needs and matching them with valuable solutions. 

28. Pricing add-ons 

Buyers are more likely to accept the price of add-ons when they are framed against the price of the entire deal, rather than a subset of the deal. Example: charging $20,000 + 10% shipping is better than separately negotiating $2,000 for shipping. 

29. Beware the promise of future business 

Some customers propose: ‘give us this discount and we will view it favourably for future business.’ The future advantage rarely emerges. You have identified yourself as a discounter. One response: ‘we will give you the discount for prepayment of the future work.’ 

30. Increasing prices 

Many existing customers will simply accept a ten per cent price increase. You might need to change perceived value, of which price is merely one element. A price increase goes straight to bottom line (perhaps shared between salesperson and the sales company). Also, utilise high price and tiered price options. 

31. Create switching costs 

Think of ways for the customer to become more invested in you as a supplier. Bundled services, co- location, software, and providing training make it harder for the customer to switch to another supplier. This often translates to pricing power. 

32. Do not discount then skimp on service 

It is better to not do the deal than skimp on the delivery of products and services. Align price with true value. 

33. Strengthen your relationship with the buyer 

If the buyer feels they have lost in the negotiation the deal might fall apart in implementation. The buyer might also not purchase from you again. Negotiate effectively but help the customer to achieve value. 

34. If agreement is not reached 

Thank the prospect/customer for their time and commitment to the process. Make them feel welcome to deal in the future. 

35. If agreement is reached 

Thank your customer for their time and commitment to the process. Summarise verbally and/or in writing all the deal elements. Resist the fear of losing the deal. Clarity will help with a smooth implementation.