The Art of Negotiation.
Last week Unicorn Events attended EventHuddle´s panel discussion on ‘The Art of Negotiation.' The event was tailored towards getting the most out of your negotiations in different situations, with points to take away on the main dos and don'ts.
Everything is adaptable and negotiable. A simple, yet crucial takeaway from this month's discussion. It is important to remember that the first offer is never the final offer. Although negotiation is thought to be a form of confrontation, you should never aim to make a negotiation confrontational. Instead, remember that you are there to ensure you both get the best deal. Get comfortable with being uncomfortable, as there will always be push back.
Many people are anxious to push back or challenge their suppliers, at the risk that this will cause damage to their relationship. The thing we really need to consider is whether or not we briefed in enough detail in the first place to get a quote that matches our needs exactly. When dealt with appropriately, negotiations will only enhance a relationship, not damage it. With this, it is essential to remember there has been planning and preparation prior to each negotiation and behind this, reasoning for what is being offered. If there are difficulties, explain and have a conversation. Both parties will benefit from these discussions. What is at stake for you?
Most importantly, it is not about what you can't do, but what you can do. Take the lead and offer what you can afford to, then justify. By providing a solution and justifying it, your offer will always achieve more than simply advising what cannot be done.
To summarise for future negotiations, we have gathered several of our favourite guidance points.
Planning and Preparation
There’s a lot of information out there on the importance of planning and preparation.
By planning, you are not only thinking about what it is that you can offer and your bottom line, but also what they need and require from you to ensure the scales are balanced. Simple questions such as, ´who are we negotiating with?´ or ´what is at stake from them?´, will ensure you are also thinking of their needs.
When planning for a negotiation it is clear that a large amount of the deal will revolve around a figure. However, this should not be the only item on the agenda. Think about what you can offer that is not monetary. Are there value adds that you can offer to create a comprehensive proposal and ultimately a deal that they cannot say refuse?
If you are of a quieter nature or see yourself as an introvert, do not be intimidated by these situations. The easy solution is to be prepared, keep it simple, and know what you are talking about. Negotiating is about listening. Make a proposal (nothing's carved in stone) and create an understanding for both parties. Don’t make it a shouting competition, as this is often a no go when aiming for an ethical deal for both parties in any case.
Long Term Relationships
Circumstances have a large influence on negotiations and how they will be steered. A great example of this is when you have a long standing relationship with your supplier. Let's in this example say we are working with a supplier. When you are looking to come to an agreement, you have to remember that in already established relationships there is more to lose, but equally more to gain. People are more worried about losing what they already have as opposed to getting something that is not yet in their possession. When you can secure a multiple year contract or ´bulk buy´ it creates a dependency on each other and as a result your interests are aligned. This will help when going into future negotiations for additional services. When your interests are aligned the success of both parties becomes the ultimate goal, rather than trying to walk away with the ´best´ deal or a ´win´ over your supplier. Equally if we look at this as an agreement with the client, just because you propose something that may not work on that particular occasion, with a relationship that is already established it is likely to be a not now, rather than a hard no.
Situations to Avoid
Negotiations needs to be ethical for long term relationships, but as previously mentioned negotiations can be seen as inevitable confrontations. It is too often seen as a battle or that the other party are the ´enemy´ due to the constant push back. By going in with an unreasonable and stubborn offer, you are only looking to fail; always consider the risk for both sides. If you are unsure of their risks, make it your business to know. Ask what their goals are and where the bottom line is.
A point that arose in this month’s discussion was that clients can been seen to use bullying tactics. Don't succumb to these tactics, and distance yourself from the deal. Instead, understand why they are pushing in this direction. More often than not it will be the internal push back from management or procurement. Your willing to understand their position and eagerness to work together to secure the best option will result in a better outcome for both sides. This removes the sense of confrontation and relentless push from either side.
It is common that at some stage (particularly with larger contracts) procurement will take over the negotiation and your direct client has no say in the final decision. A great way to tackle this is the following:
1 - Involve procurement from the start and ensure they have an understanding of your goals, your company and the end event. This will create more flexibility in their thinking, just by having the context of why something has to be a certain way.
2 - Remove yourself from the bottom line by taking your proposal and negotiation to the next level. You can do this by simply bending the rules and asking the right questions. What can I do for you to make ‘X’ possible? What do you need from me?
Remember, every rule was made by a person and as a result can be changed or negotiated.
A simple example could be that in the brief received, your client has instructed that they want ´Y´, but if you have a better solution that is ´Z´ you are immediately putting yourself on a different level to the multiple other companies providing the same solution. Make it about the value adds and solutions, not just the money, or the bottom line. This is where asking questions is important, as there may be reasoning behind ´X´ that will lead you ´Z´ where you are ultimately fulfilling their request, but at the same time enhancing their experience and/or lowering their outgoing cost.
Dealing with Big Egos:
In a situation where you come across a difficult personality, it is essential to remember that it is not about winning. Never take on the challenge, but instead give the appearance of losing whilst getting the best deal you can. An easy hack for this is to prepare and know your absolute bottom line. Knowing this in advance will put you at a great advantage. Go in with an offer that gives you plenty of room for movement, which will then allow you to ´begrudgingly´ move closer to a proposal that can be agreed upon. Be sympathetic towards what they need and create a sense of working hard for the deal. When you work hard for something, it is more valuable. Make them feel great about it.
This brings us to the end of our EventHuddle summary, exploring ‘The Art of Negotation’. Remember preparation is essential and everything is negotiable!
What’s your best negotiation trick or tip? Let us know on Twitter @UnicornEventLtd.
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