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customer sales negotiations best practices

Customer “Negotiations” Best Practices (Avg VS Great Sales Professionals)

Whoever is in B2B Complex selling, all of us go through the “negotiation” phase of “Sales Process”, Unless you are a Monopoly or a Utility player in your industry, most of us go through it time & again.

Few of us have undergone “Negotiation Skills” training in our Sales Career. It taught us several concepts viz. “Body Language, Eye movement, Negotiation styles such as Good cop- Bad Cop etc”. I am assuming most of the sales reps become good in their observation skills over time. So, I won’t go deeper into the above.

Based on my own selling/team-management experience and working closely with diverse Sales Organizations, I have tried to capture key differences in traits between “Best” Sales Professionals and the “Rest” in their ability to manage “negotiation”. I am not claiming following to be always true. Just that, it pains to see “Hardworking Sales reps” at times giving away steep discount. Had they played their cards well (still maintaining win-win with their customers) and prepared a bit more, their company’s margins could have been better. Following is based on my learning. Feel free to correct me, add more points or ignore what you feel is irrelevant. Here you go.

Average Hard-working Sales Rep

Great Sales Professional

Consider selling and negotiating as same or overlapping

They know - Negotiation is not a substitute for selling

Negotiate too soon

They negotiate late. They Negotiate only, when necessary in the buying cycle

Don’t know much about customer's decision criteria

Have done her homework well before getting into negotiation. This helps her focus on areas of maximum importance to the customer, instead of remaining "pricing" focused

Negotiate primarily on price

Keep larger picture in mind. Generally, don’t keep price as an initial point

End up giving steep "concessions"

Knows various Negotiation levers eg. "Trade Off". Split the difference", “extension” etc. Gives (steep) discount as a last option

Prepare to react/defend for Nego meetings

Also use "Questions" as an effective strategy tool for Nego meetings

Take extreme stands - either they don’t budge at all or give a heavy discount

They prepare their upper and lower limits of negotiation range and subsequently narrow the difference

Mostly lands up in Lose(for seller)-Win (for Customer)

Prepares and achieves Win-Win

Tries to keep controversial Scope of Work items under the wraps. Mostly it leads to escalation during implementation stage

Explicitly discusses everything to avoid surprise during implementation phase

He is under pressure while entering negotiation meeting

Knows well that even other side (customer) is under pressure as well

Enters late in the sales cycle (mostly at RFP/RFQ stage). Don’t have coaches in the deal

Enters early in the sales cycle (at problem/concept definition stage). Have been able to develop coach/es. Hence gets required insights/guidance before negotiation meeting

Does not prepare in a structured manner for the meeting

He follows "meeting preparation" process. Knows how to start the meeting, what questions to ask, he pre-empts customer's questions /expectations/ reactions/ objections, prepares his responses for different scenarios and knows his best case and worst-case position

Generally, drops his price too soon. Don’t have plan B if customer does not agree to his offer

He has developed alternatives and tries to optimize outcomes. He will go for Win- Win

He does not do a great job during "selling" stage and positions his solution as "me too"

Does a great job during "selling" stage and positions his solution as "uniquely differentiated"

He is not able to think like the other party

He thinks like his customer and knows what the buyer’s actions/expectations at this stage of buyer’s decision-making process would be

Does not know what buyer's view about importance of his product or "difficulty of substitution" of his product

Knows well where his product and his company are positioned in Buyer's internal analysis of "segregation of suppliers"

Does not know Value/ROI of his product for the customer

He develops himself to sell on "Value" and not on "cost". His coaches guide him to maneuverer the Nego process

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I am sure there are many more to this list. One key point I would like to highlight is – “Negotiation is not a substitute for selling”. Selling done well eases the negotiation pressure.

Selling + Negotiation (backed by Structured meeting preparation) should improve the odds of winning, winning with right margin and eventually creating Win-Win with our customers.

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About the Author

Vishal Mehta

Vishal Mehta

Vishal is passionate about the science part of B2B Sales. He is a Co-founder of “B2B Sales” company –Sales & Profit (SalesPro Business Solutions Pvt Ltd) – It is into Sales Consulting, Sales Technology, Sales Training, Sales Recruitment and Lead generation. You can reach him @ vishal.mehta@salesprofit.in

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