Owning a business requires many skills; one of the most important is negotiation. As a business owner, you could find yourself negotiating in many different circumstances, such as:
- Financing terms with a lender
- Salary and job expectations with a potential Team Member
- Payment terms with a supplier
- Lease or property agreements
- Equipment agreements.
Negotiating will impact your financial situation, which is why it’s always essential to refine your skills. That way, you’ll feel confident when it’s time to negotiate.
Here are four tips to improve your negotiation skills.
Be prepared
One of the best things you can do to advance your skills is to be prepared. By being prepared, you’ll be better able to negotiate beneficial agreement terms, and you can identify when someone is offering you a great deal that you should take advantage of.
It would help if you did your own research to understand the situation you’re negotiating in. Get to know what terms and agreements businesses similar to yours have agreed to, what other options you have available to you and how they would stack up against the agreement you’re considering.
Also, think about what you would consider a good agreement. Ask people how they have handled similar negotiations. Finally, make sure you have a backup plan if negotiations fall through. It’s easier to walk away from negotiations if you have a backup plan in place.
Know what you’re willing to give up
Before you start negotiating, it’s important to not only know what you want but what you’re willing to give up. Would you give up partial control of your company for more shares? Would you lose an investor so that you can keep more shares in your company? Would you pay more money for extra storage space?
Knowing what you will and won’t give up on helps you stay focused and can prevent you from making snap decisions that you may end up regretting. It also assists in assessing whether the deal is good for you and enables you to push to keep the most important things.
Practice negotiating
There are plenty of opportunities in your daily life to practice your negotiation skills in a low-stakes environment. You can practice negotiating what activities to participate in on the weekend, who has to do the chores, or where you want to eat for dinner. Use these situations to develop your listening skills and your ability to find a way to mutually beneficial terms.
Keep it conversational
Negotiations are about both sides walking away feeling positive about the decision that has been made. You don’t want a negotiation to cause conflict. Remember that you are having a conversation to reach a beneficial agreement with everyone involved, and keep in mind that it isn’t personal. You and the other parties both want to get something out of the agreement, and you want the other side to come away happy as well.
Final Thoughts
Negotiating is an important part of business life. Ideally, you want to feel relaxed, confident and prepared to go into any negotiation. The best way to do so is to conduct your own research, know what you want, keep things conversational and practice your skills.
If you have any questions or would like to discuss this further, feel free to Join the conversation…