Join Lisa Earle McLeod for an in-depth discussion in this video When giving something away adds value, part of Sales Negotiation.
- Most people enter a negotiation thinking about what they can get, but one thing you want to do that will actually make you very differentiated is think about what you can give, what you can give away, something that adds value and doesn't cost you a lot of money. And if you can think about those types of things, it keeps you from negotiating on the purchase price alone, and it adds value in a way that makes the client feel great. So I'm not a big fan of pre-scripted techniques, they often smack of manipulation, but let me tell you a few things that I've done.
One technique I've used is provide something the buyer didn't expect. You might want to think about this as reputation insurance, and it creates a feeling of good will. Before you close a deal, think, "What else could I do to ensure that this deal "not only closes, but that it's successfully implemented?" Get creative. The way you do this is gonna be different, depending on the client, but let me give you an example. We were negotiating a very large consulting agreement, and we had spelled out really clear objectives, we had identified measures of success, and we had identified great value for the client, but right before we closed it, I looked at it, and I thought long and hard, "What would "make this even better for them?" and I realized if we provide a six month review, now this was a 12 month long contract, but if we provide a six-month review, that will give the client a chance to tweak the project before the contract runs out.
Now, this wasn't a huge cost to us. It was some time on a conference call, but it was very, very valuable to the client. So think about, "Is there something you can do "at the end of the deal that makes the client go, 'Great!'" A second thing you might want to consider is be flexible on terms and conditions. You see, you're always better off adding something to the deal rather than taking something away. So, if, perhaps you can give them some some extended terms, you can give them greater use or greater access, or something like that where you're adding something in, that keeps you out of negotiating along the purchase price 'cause when you lower the purchase price, you set a precedent, and you're gonna be stuck with low margins forever.
When you add things in, it adds value to the client. A third thing you might want to consider is offer a prepay discount. Now, we do this in our business, and it solidifies the deal, and it makes sure that your client is bought in for a successful implementation. Now, I didn't come up with this idea myself. I learned it from my mentor, Alan Weiss, and here's what I figured out. If you offer a significant prepay discount, you may give up some margin, but it ensures that the deal will stick.
It saves you tons of money over time because that one deal that might have canceled before they'd paid for it, you already got your money in advance. So when the client prepays, you're not on the hook for meeting certain deadlines. Now, you want to meet your mark, definitely, but if the client slows the process down, it doesn't matter because it doesn't affect your payment. So think about, "How can I add value "in the negotiation process, particularly when it comes down "to the end of the deal?"
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- Three kinds of sales negotiation
- Why deals fall apart
- Spotting and diffusing negotiation traps
- Asking for their boss
- Negotiating via email
- Avoiding renegotiating sales