The Top Five Items a Salesperson Needs to Know Before Heading into Negotiations

In order to negotiate effectively, you need to be armed with the most accurate information possible. I have listed below the top five items you need to know before heading into negotiations with your prospect. If you can accurately identify the answers to each of these five items, you will be well prepared as a salesperson to negotiate the sale to your favor.

1. Which party made the initial contact at the start of your interaction with the prospect?

-This item is rarely ever thought of by the time negotiations are getting ready to take place. If your prospect contacted you first, however, I would take this to mean you are in a little stronger position than usual. Someone who was interested in your product or service without you needing to “generate” that interest probably has a strong desire to take action. Remember, the party in the negotiations that “wants” is the party who is in the weaker position.

2. Was your prospect adequately qualified to your standards?

-Salespeople rarely perform this activity in the belief it will drive away prospects. However, you need to make sure the prospect’s time line, credit, payment terms, and real needs are up to your standards. If any of these items are not up to par, you aren’t ready for negotiations. You simply have an unqualified prospect you are wasting time on.

3. Did you prove your profit-justified proposal in your prospect’s mind?

-Have you either presented or plan to present a profit-justified solution to your prospect? Proving that your product or service will improve efficiency, decrease expenses, and increase revenues will put you in a very strong negotiating position with your prospect. On the other hand, if you fail to prove your profit-justified solution you will be in a very weak negotiating position. In my opinion, this is the most important item you need to address in order to negotiate a sale to your favor.

4. Do you have a backup proposal that can address the prospect’s needs if your primary proposal is turned down?

-Sometimes a customer might really like your primary solution involving your products or services but simply does not have the money or credit to pay for them. While many times you can uncover this situation during the qualifying process, you might be taken by surprise during the negotiating phase of your sale. If this problem arises, it is always wise to have a less expensive solution that still addresses the prospect’s needs. While it might not fix the problem as well as your primary solution, it could be the right middle ground that both you and your prospect can agree upon.

5. If the need for a price concession on your part arises during negotiations, have you planned on what you would like in return?

-Salespeople rarely plan for what they might be able to ask for in return for a price concession during negotiations. Usually, the salesperson heads into negotiations armed only with the “rock bottom” price they can get away with to still make the sale happen. A referral of high importance or a trade on price for another future sale might be a couple of things you can ask for in return for your price concession. Ideas for what you can ask for are limited only to your imagination, so make sure to plan for this accordingly before heading into the negotiating phase with your prospect.

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