The best negotiators in business all have one thing in common: They do their research. Having negotiables and clearly defined end goals, identifying common ground, and defining your walk-away position help you make the best deals for your firm. Also aim to research your potential supplier's position and what you can offer them prior to entering a negotiation meeting. Doing in-depth market, business, and vendor research is the best way to identify those parameters.
If you're entering into a business negotiation but are unsure of the research you need to conduct and its benefits, this guide can help.
One of the key benefits of negotiation is finding out how valuable your business is to your potential supplier. Researching the market and your vendor's business allows you to understand how much value you can offer them. This strengthens your negotiation position as it solidifies your value creation at the negotiation table.
Value creation refers to business solutions that benefit both parties. If your vendor recognizes the value your business offers them, the negotiation is more likely to swing in your favor. However, you must understand your business's value to present it to the other party, and undertaking research is the only way to truly understand that value.
A vendor's hidden currency refers to aspects of business that your potential supplier values highly. If you can discover a hidden currency you can offer the other party, you're more likely to seal the deal.
For example, your vendor may value incorporating fitness and exercise into their lifestyle alongside their business. If your company can offer a subsidized gym membership to the vendor, they're more likely to be amenable to compromises within the negotiation.
By conducting some research into your potential supplier, you can get inside their mind and begin to understand their negotiation tactics. Using information you glean from your research, plan the negotiation process as if you're the vendor. This helps you see your firm's proposal through the eyes of the vendor, highlighting where the two companies' interests may clash and how you can overcome the issues.
Once your research is complete, consider how you present your contract. Regardless of the amount of research you do, if you don't present your contract in a streamlined and attractive way, your chances of negotiating a good deal diminish drastically. If you're unsure of how to effectively present a business negotiation, a surefire way to make your contract look great. Be sure to convert a PDF to Word to make any final edits before sending your contract.
Being well-versed in your business's strengths and weaknesses and having insight into your vendor's position are fundamental to the success of your negotiation, so don't forget to do your research when entering into a new contract.
If you're still unsure of how to effectively research your vendor or you want additional assistance before your business negotiation meeting, you shouldn’t hesitate to reach out to your peers.
Consider joining your local chamber of commerce for essential networking and assistance.