Do you think that negotiation is a technical term confined to the domains of sales and procurement? Do you think that negotiation is something of esoteric science and not for you? If yes, then think again! The basics of negotiation are ingrained in our very DNA, it is not something that you learn from books!
Kids negotiate with parents all the time, though they have never attended a Negotiation training session. Every one of us negotiates for various things in different stages of our life. We negotiate for the house that we are buying, we negotiate salaries with prospective employers, and the list just goes on. So if negotiation is inborn in all of us, what is the need for all the negotiation courses and negotiation training sessions?
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The Basics of Negotiation
Negotiation in business, be it negotiating as a salesperson or as a procurement professional is a well-honed science blended with a touch of art. The greater the stakes, the greater the need for better negotiating skills. We take a look at the basics of negotiation, discuss a few effective negotiation skills, and suggest some basic negotiation strategies, that would be useful for those beginning a career in sales or procurement to up their sales skills as well as effectively use the techniques of negotiation.
The Basics of Negotiation – Principles of Negotiation
What is negotiation? At the very core, negotiation is nothing but a discussion between two parties with the sole aim of arriving at a consensus or agreement. The negotiation could be anything from buying or selling a car to securing the release of kidnapped hostages. However, here we discuss the basics of negotiation as pertaining to the business domain, which essentially is focused on buying or selling a product or service or even a company.
Basics of Negotiation | Basics of Negotiation For Beginners | Steps of Negotiation
The process of negotiation can be broken up into four main phases. In the real scenario, these steps may actually happen concurrently with no apparent distinction between the phases. The four main phases of negotiation are listed below:
Getting Ready – Basics of Negotiation For Beginners | Negotiation Strategies
This phase in simple terms is just doing your homework. Being prepared for your negotiation is half the battle won. So this is the phase in which you do all your research about the person or company you are negotiating with. It is essential that you do a complete SWOT analysis so that you are aware of their strengths and weaknesses and are able to quickly spot any opportunities or threats in the course of the negotiation. If you complete this phase properly, you will be well prepared to leverage information that you have to your advantage. After all, information is the key to power.
Beginning or Opening The Negotiation | Negotiation Strategies
After you are done with all the pleasantries, it is time to state your price or what you expect from the negotiation. The trick here is to be neither over-ambitious nor underestimate your own strength. It is best to start with an optimistic figure which is also realistic and would lead to a win-win situation for both the negotiating parties. Your opening would depend on the information that you have collected in the first phase.
Discussion And Actual Negotiation
Once you have made your expectation clear with the opening, the ball is set rolling. It is now the time for offers and counter-offers. This is the phase that requires the use of your negotiating skills and these would include your listening skills and analytical skills. Make sure not to drive an unrealistic bargain, negotiate on the platform of mutual trust so that you move towards a win-win solution. Give some concessions that you think would be of value to the other party and which may not be too expensive for you.
Culmination | Closing The Deal
Once you see the signs of eagerness or interest from the other party, go for closure by subtle indications. Do not however rush things. Gently progress to the closure of the deal giving an impression that you are conceding to the other party’s demands, this will help in closing the deal on a win-win note.
Negotiation Skills | Basics of Negotiation | Negotiation Strategies
Negotiation is an art and also a science. There are some basic skills that distinguish a good negotiator from the average. Some of the negotiation skills that are sure to stand you in good stead and take your negotiation up by a notch or two are listed below:
- Effective presentation and communication skills
- Excellent listening skills
- Effective rapport building for gaining trust
- Analytical skills to quickly respond to dynamic issues
- Quick decision making
We hope you liked our post about the basics of negotiation and you will find the information useful in your personal and professional life. Subscribe to our blog for interesting and informative articles on a wide spectrum of topics. Share your thoughts with us through our comments section.
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