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Negotiations for Small Business

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					Negotiation

So who is Mark Harrison?
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37 years old Studied Maths / Computing at Oxford, formed my first company in my finals year. [It failed, BTW] Joined the workforce in 1992, discovering IT paid better Climbed the greasy pole for a few years, retired in 2003 (because I’d bought a bunch of investment properties) Got bored…. Now do three things (sometimes at the same time)
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Interim Director Run a training / mentoring business Non-exec Director

We're all at it
vs.

vs.

Tim is (even now) WAY better at tennis than me

Three Components
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Principles
Psychology Ploys

what
why how

Principles

Principles
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You spend all this time worrying about what your customers want BUT…
What the hell is it you want?
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Please DON’T tell me it’s a sale Cashflow?

Growth (because you want to be bought)
A one-off purchase vs. a long-term relationship
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Think carefully, your customer might want something different

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The longer time they invest in negotiating, the more motivated they are to agree a deal
BATNA (Best Alternative To Negotiated Agreement) Work out who the “economic buyer” is
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If there are several, find them ALL If your business is B2C, see later about WOMEN

IT’S NOT ABOUT PRICE
People buy from people / brands Buyers value other things - (Speed / Security / Service) - eg FSC Certification

Before you go into the negotiation
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What's the MOST you can pay
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Or least you can settle for, if you're selling

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Auctions vs. leveraging Proprioception

Close the (conceptual) sale before you start talking about price Sell what customers want, eh?

Psychology

Beliefs
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Empowering Disempowering It’s a law?

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They need you?

Never say yes (or offer the asking price first)
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What happens if you do?
Is the seller
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Happy Unhappy

Ploys

Ploys = Strategy + Tactics
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The strategy
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Frame the negotiation Get the seller to invest time

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Never give away too much in one go
How much authority?

Opening Tactics

Frame the negotiation Offer low / Ask high
(Kingfisher compensation)

Tactic The Opening Response
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Flinch
For phone, gasp

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Just a bit of fun, or is it?

Time Tactic Ask the wife
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For those without a wife...
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Husband Boyfriend

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Girlfriend
Partner

Take your time

Women buyers
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Women buy… (US figures)
94% of home furnishing – 92% of holidays – 91% of new homes – 89% of new bank accounts – 80% of DIY purchases – 60% of cars – 51% of consumer electronics [Source: www.tompeters.com]
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Relationship Networking
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This is not “wishy washy stuff”

Go away… then, when you come back...
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Only come up by a small amount
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I was selling…
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My asking price, £179,950 They offered £170,000

Splitting the Difference
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Whoever offers to, loses
Encourage the vendor to make the offer

THEN
We aren't going to drop this over a few thousand / hundred are we?

Good cop, bad cop
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The vendor is bad cop
The estate agent is good cop

There is no good cop
OK – it’s a property example, but use what you learn across ALL your businesses

www.yourpropertyexpert.com


				
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posted:12/12/2007
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