The way we do business has changed. In the B2B sales space, this means the interactions between buyers and sellers need to change. More than ever, customers are laser-focused on their business and maximizing organizational value. They enter today’s sales cycle well-informed about a product or service and the surrounding competitive landscape. They are less tolerant of being “talked at,” preferring instead to be part of the conversation.
The good news is that salespeople skilled in a collaborative give-and-take dialogue with their customers have a distinct competitive advantage. The not-so-good news is that few sales professionals have been taught any selling skills beyond push-pull bargaining tactics and warring over price.
When the salesperson caves on pricing, rather than respectfully and intelligently negotiating for an agreement that would benefit both parties, margins and profitability suffer.
A principled negotiation process can help the salesperson engage in a more sophisticated conversation with prospective buyers, transforming his or her role into one that resembles a trusted advisor – someone with whom the customer can explore a variety of options and opportunities for the benefit of both buyer and seller. The process includes five practical strategies:
1. Separate the people from the problem. Nothing can stop a negotiation faster than tension. Skilled salespeople know how to remove emotions from the buying process. It could be as simple as a salesperson recognizing when he or she needs to say, “I’m sorry for the misunderstanding,” or acknowledging the customer’s point of view in order to move a situation from confrontation to collaboration.
2. Identify the interests behind the position. Often, when a discussion is stalled, asking a few key questions will determine what is driving the buyer’s position and will reveal what they are interested in achieving or avoiding – the interests behind their position. Focusing on these interests will move the discussion closer to a solution.
3. Invent options for mutual gain. This strategy is like creating a bigger pie instead of trying to divide the existing one. Once the seller uncovers the buyer’s interests, he or she exposes an entirely new set of options that create new value. At that moment, the seller stops being a salesperson pushing a set of features and starts being a partner in creating value.
4. Use independent standards. When the two parties reach a stalemate over specific issues, either can refer to objective benchmarks (industry/independent standards, research findings, trade reviews, etc.) to move a negotiation forward and provide a level set.
5. Know your BATNA. Sellers should decide ahead of time the point at which they’re no longer willing to negotiate – in other words, their best alternative to a negotiated agreement. Without determining the bottom line prior to meeting with a prospective buyer, the salesperson might accept an unreasonable and not realize until too late that it wasn’t in his or her own best interest. A good BATNA prevents the salesperson from accepting a bad offer just to make a sale.
Business has changed, and the buyer-seller relationship has changed as well. Today’s customers want – in fact, need – salespeople who are smart, principled and well-informed about their business. As buyers, they want to negotiate with a vendor to generate new value for the organization, not bargain over features and price.
Successful salespeople have learned how to professionally engage and listen to today’s savvy buyers. They know that becoming principled negotiators means finding intelligent solutions that benefit both the buyer and seller while building relationships for future deals. A sophisticated sales force that is focused on the interests of both its customers and its organization will see improved customer/vendor relationships and increased revenue – a true win-win solution.