Effective Negotiations

Arguments aren’t always bad things. Sometimes They’re used to convince someone of an important point they may not yet realize.

You’ve probably used arguments in this way most of your life in fact!

Maybe you wanted to go somewhere and had to convince your parents that it was a good idea to let you go. So you argued your position with them.

Maybe you wanted to buy a big ticket item and had to argue the value of buying it with your spouse!

Arguments don’t necessarily have to be shouting matches. They can simply be a device used to convince someone of something that you feel is important.

It’s funny then, how so few sales people use the art of arguing to sell their products. Wouldn’t a person who wants someone to buy something from them want to try and convince that one that it’d be a good idea?

Maybe it’s because it’s not such a good idea? Continue Reading»

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Have you ever tried to negotiate a deal for software, computer equipment, or consulting services with a technology company? The task can be daunting. Unfortunately, the sales forces of most IT companies are armed to the hilt with techniques to get the best deal for them, and not necessarily the best deal for you. And even worse, most of us computer folk (like myself) have never been trained in the art of negotiation, so it can be difficult to spot a snake in the grass. Before you begin negotiating a technology deal, know what you’re getting in to.

Solicit, Don’t Be Solicited

I receive at least three calls each day from technology vendors interested in selling something: hardware equipment, software tools, consulting services, etc. Usually, these calls are “cold”. My name somehow landed on a telemarketing list in the hands of some vendor who is calling me out of the clear blue sky hoping that what they sell somehow matches what I need. You can waste hours on the phone letting some non-technical, script-reading, telemarketer or sales representative chew your ear off about their latest and greatest gizmo. Very rarely do these types of calls ever translate into a real business opportunity.

The most popular cold call opening is “Good morning. This is Joe from the XYZ software company. We offer break through whatever solutions to help you reduce your total cost of ownership for whatever. Let me ask you, are your responsible for managing your companies whatever investment?” I get so many of these calls that I can answer them in my sleep. Years ago, I used to engage in some level of discussion with these people and it always went nowhere. Unless you really think they’ve got something you might want to buy, cut them off immediately. And just like any telemarketer, they have a scripted response for anything. Continue Reading»

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In any conversation with two or more people, there is a tendency to want to talk all the time to fill any awkward silences or gaps that appear in a conversation.

However, if you think of the conversations that you have with your closest friends or family, you will notice that there isn’t the same need to fill these gaps, as silences between you are comfortable. This is generally because you know the other person and the type of character that they are.

Now, if we change this scenario to the sales process you will see that it is a completely different feeling to the one above. Suddenly silence is your worst enemy, the one thing to be avoided during negotiations, the realisation that you are losing the sale.

Well actually, that last statement is completely wrong!

Because a person does not say too much during negotiations does not mean that you are losing the sale. Yes, silence can be awkward to some but to those of you who want to win, silence can be your best friend. Continue Reading»

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Consultants who offer executive assistant or computer services on a virtual basis must know their value and be prepared to gauge their billable rate to meet the circumstances.

At some point everyone encounters potential clients who expect professional work at rates that are less than appropriate. For example, a posting advertises an opportunity that matches your highly polished skill set. After making contact with the client you find they don’t want to pay a reasonable fee for the services they expect.

While these types of engagements might help to build a newcomer’s portfolio or pay some bills when money is tight, a successful virtual service provider knows their value and refuses to be exploited. Make sure clients understands your training, background and areas of expertise. Then, set expectations for services by pricing in accordance with your qualifications and skills.

Be prepared to be flexible, yet firm in your compensation requirements.

? Determine your base rate in advance of client discussions. Scratch it out on paper or create a spreadsheet. Take into account the fixed overhead and variable costs to legally operate your business

? Determine your flex-rates for times you might be willing to work for slightly less or feel the need to demand more pay.

? Calculate the value added for meeting tight time constraints, the demanding nature of the client or the complexity of the project

? Take the time to project costs not otherwise considered in your base rate (long distance, printing, etc.)

A pre-determined rate scale helps you respond calmly and logically to stressful situations, so you can advert potential disasters.

Last year I turned down what seemed on paper to be an ideal “personal assistant” opportunity. The ad described duties such as checking email and preparing responses on the client’s behalf. Work assignments would be completed by phone and fax for a client who did not want to use a computer.

The job matched my skill set, but I chose to pass because:

1. The offered rate was 50% less than the low end of my base rate range.

2. The client expected me to own and pay for the operation of a fax machine, but was unwilling to pay for its purchase or operation.

3. The client expected a commitment to work for him part-time, even though hours were going to be determined by him each week

4. The client’s refusal to even consider using a computer was destined to create confusion and conflict over what I prepared on his behalf

Regrettably, I realized this potential client was a fussy, technology laggard who wanted a very experienced, highly reliable personal assistant who was agreeable to an entry level rate.

Know when to “pass” on a client so you can continue to market to more viable prospects. Try to negotiate a better rate with clients by matching their expectations with your level of service. Keep an eye out for performance bonuses or other types of perks to balance out discounted rates for good clients.

Elisa Shostak is the founder of Compass Rose Strategic Consulting LLC, an advisory service and secondary research firm based in Seattle, Washington.Elisa can be contacted through her website: http://www.compassrosellc.com or blog http://www.compassrosestrategic.com

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This article is one of the many articles still to come in which I will discuss very basic yet proven techniques that you could use immediately in your encounters with your suppliers.

Oh but wait, to find any value in this article, you must be a firm believer that Purchasing strategies have evolved from just 1) focusing on price and 2) focusing on quality, reliability, responsiveness and total cost to a much broader focus of building supplier relationships.

Did you know that for each $1.00 you save in your “total cost of ownership” reduction efforts, you will improve your bottom line profitability by $1.00? And did you also know that most companies do not get this concept and continue focusing their resources in all the wrong places?

Now is the time when I want to share with you 4 basic rules that have proven to work and work very well to help you create the partnership relationship with your supplier and allow them to equally benefit from the experience as well. Continue Reading»

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Not long ago, I made a partnership pitch, on behalf of an organization I represent, to another organization with similar interests. If the idea had come to fruition, it would have radically changed our organization.

So, you can imagine my impatience when I didn’t hear back from the person to whom I’d made the proposal. She had welcomed the idea, but told me the decision would be made by a council within her organization.

Given the dynamics of an important decision about the future of their organization, I didn’t expect a quick response. But, I would have liked at least an update advising me on the status of their considerations.

Then, I had a “Eureka,” or maybe I should call it a “Whoops,” moment. Continue Reading»

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Obviously, you might logically say, “that is good!” You would most certainly be on track feeling good about everyone in your area having a job. Getting everyone working and being more self-sufficient is our logical goal.

WHAT IS FULL EMPLOYMENT?

For many years, the marketplace has considered 4% to be reaching a full-employment level. Very few employee choices are available. Many in the 4% (unemployed) group have little or no talent to offer. No basic valuable marketable skills. Most of these unemployed persons have a very poor work history. Not all, but a large majority have a limited education at best.

OUTSOURCING and DOWNSIZING

News continues to flow regarding outsourcing by major employers in almost every industry. Jobs are moved to an “outside” service for economic reasons. Many employers cut their workforce to meet PROFIT expectations for the quarter. Good decision? Not the issue when the level of profit is deteriorating and action is imperative. Continue Reading»

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 Smart buyers will always ask for a better price. Unfortunately, too many sales people and business owners automatically think that reducing their price is the most effective way to respond to this request.

However, negotiating is not always about price. Although price is a factor in virtually every sale it is not usually the primary or motivating factor. Everything you say and do from the first contact with a prospect affects the value of your product or service in their mind. That’s why I believe it is important to look at the negotiating process differently in order to achieve better results.

First of all, invest time gathering information about your prospective customer, his needs, situation, and buying motives. Continue Reading»

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 Cross cultural negotiation is one of many specialized areas within the wider field of cross cultural communications. By taking cross cultural negotiation training, negotiators and sales personnel give themselves an advantage over competitors.

There is an argument that proposes that culture is inconsequential to cross cultural negotiation. It maintains that as long as a proposal is financially attractive it will succeed. However, this is a naпve way of approaching international business.

Let us look at a brief example of how cross cultural negotiation training can benefit the international business person: Continue Reading»

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How many times have you heard:

“You’ve got to drop your price by 10% or we will have no choice but to go with your competition.”

“You will have to make an exception to your policy if you want our business.”

“I know that you have good quality and service, but so do your competitors. What we need to focus on here is your pricing.”

“I agree that those special services you keep bringing up would be nice, but we simply don’t have the funds to purchase them. Could you include them at no additional cost?”

Every time you hear statements like these, you’re in the middle of a difficult sales negotiation. How you handle that negotiation will determine whether or not you close the sale and how profitable that sale will be. In order to give you a real edge every time, I have listed below some key points taken from my sales negotiation training seminar. Continue Reading»

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