How to Negotiate Like a Salesperson

women talking in office
Negotiating is a key sales skill. Thomas Barwick/Stone/Getty Images

If you're in sales at any level, knowing how to negotiate is a crucial skill. The more expensive your product is, the harder your prospects will negotiate with you. But even if your primary product sells for $0.59, sooner or later you'll find yourself in the middle of a negotiation. Negotiations aren't always about price – you may end up debating issues like delivery schedule, shipping costs, maintenance fees, and more.

Knowing how to negotiate can also help you out in non-sales situations. For example, the next time you go looking for a sales job, negotiation skills can get you a better commission rate or an extra fringe benefit or two. And when you're on the buying side of a sale, knowing how to negotiate better than the guy who's pitching to you can save you plenty of money.

The first step in any negotiation is knowing what you want to get. This may sound pretty basic, but in the middle of a heated and possibly emotional discussion, it's easy to lose track of your original goals. Before you walk into a possible negotiation situation, write down the things that you most want to get from the other party and bring these notes along. If some of these issues are “deal-breakers” – you won't do the deal unless you get them – indicate that with a star or checkmark next to the item. That will remind you in the heat of the moment where you need to stand firm and where you can give a little to the other person.

Negotiations often start with both sides stating what they want to get out of it. The problem with this approach is that negotiations can easily break down into a battle for control of the situation. If you've reached the point in a sales process where you're negotiating about specific terms, then clearly the prospect has recognized a need which your product will solve.

So before you get down to the actual negotiating, you and the prospect should agree on what that need is. This refreshes the prospect's memory of why he's gotten to this point in the first place.

Next, discuss the implications of not meeting the prospect's need with him. In other words, what will the consequences be if he fails to solve the issue that he's facing? Hashing out these potential consequences will help build up his level of urgency. This discussion will also give you a better understanding of just how motivated the prospect is, which is useful information when you're in the middle of a negotiation.

The third step in this process is to flip the conversation around and look at what the prospect stands to gain by buying from you. This part is important because people are either negative-driven or positive-driven. Negative-driven people are strongly motivated to move away from pain; talking about what they stand to lose will encourage such people to make the purchase. Positive-driven people, on the other hand, are motivated to move towards something rather than away from something. Discussing how they'll benefit from purchasing the product will help instill urgency in these folks.

Finally, it's time to talk about what you want to get out of the deal. Resist the urge to mention specific terms that are important to you earlier in the negotiation process, even if the other person brings one up. The idea here is to focus entirely on the prospect and his needs during the first stages, and only afterward to start talking about your own needs. This approach reassures the prospect that his needs literally come first with you. When you reach this point, start with the issues that you think will be easiest to agree on. Each time you and the other person come to an agreement on something, it makes him more willing (and motivated) to agree on the next issue.

It will be much easier to get what you want if you understand the other person's goals and desires. When he announces his position on a bargaining point, try to uncover some background information.

Ask questions like, “What leads you to bring that up?” or “For what purpose?” Open-ended questions will often draw out a longer response, so they're more effective for this purpose. The more information you can get, the better – you'll know when to be flexible and when it's OK to stand firm on your own issues.

When you negotiate with someone, you must check your emotions at the door. Trying to negotiate while you're coping with your own anger, fear or frustration usually leads to disaster – either you'll lose track of what you wanted and make concessions you later regret, or you'll get stubborn at the wrong moment and the whole deal will fall apart. If you feel your emotions start to get out of control, call for a five-minute break and do something relaxing, whether it's grabbing yourself a comfort-food snack, playing a round of Angry Birds on your phone, calling a friend, or just sitting quietly. Then you can come back to the bargaining table with a clear head.

Sometimes the other party will be the one negotiating under a storm of emotion. This is often the reason for negotiations that fall apart at the last moment. One of the best ways to rescue such a negotiation is to make a small concession that allows the other party to accept your deal without losing face. For example, if you're stuck on the issue of price, you might offer a 90-day payment plan instead of the usual 30-day offer, or suggest that if they pay the full price you'll personally attend to the order process to make sure they get their product on time and without problems.

While you are undoubtedly professional and ethical in your choice of negotiation tactics, sometimes the person on the other side of the table will choose not to take the high road. Some professional buyers in particular are masters of sneaky negotiating tactics, and if you're not ready for these tricks you can end up giving away way too much at the end of the deal.

When a sales process has reached the point of negotiation, you'll be seriously motivated to close that sale. After all, by this time you'll have invested a great deal of time and energy in this prospect. Because of this urgency on your part, forcing delays is a commonly used negotiation tactic by prospects. A prospect might cause delays by simply becoming unavailable; or he might schedule a meeting but claim to be available for only a few minutes. He might announce that the deal needs approval from a higher decision-maker and that it will take time to get that approval. Or he may constantly request more information from you. The idea behind all of this maneuvering is to put pressure on you and force you to come to terms.

No product or service is perfect, and prospects can sometimes use that to their advantage and negotiation. For this negotiating trick, the prospect will focus on some negative aspect of the product and imply that it's a major problem for him. For example, he might obsess over the fact that the color choice "he really wanted" isn't available, and use that as leverage to get a better price on “that other color.” As prospects generally choose real product issues and simply stress their importance, it can be difficult to tell the difference between a genuine concern and a negotiation trick.

Another favorite tactic is to use an existing relationship as a lever to force a better deal. This tactic is often used by prospects who have a long-term relationship with your company. He might say something like, "How can you do this to me when I've been a good customer for five years?" Or, "I thought we were better friends than that." This tactic can be extremely difficult for a salesperson to cope with, as salespeople generally try to develop trust and rapport at every opportunity.

Prospects will sometimes insist that they want a meeting with your boss, or possibly someone even higher in your company. It's not uncommon for sales managers or executives to make concessions that they would never permit salespeople to make themselves. Thus, if the prospect can reach a sales manager or someone even higher, she may be able to get a better deal that way. And insisting on talking to your boss can be truly unnerving for you, as the prospect well knows; so he probably hopes to scare you into caving in on the negotiation.

A powerful late-game negotiation tactic is changing terms that you've already agreed on. After most of the terms have been set, including price, the prospect will try to get other items included in the deal – without increasing the price to cover them. He might ask for free shipping, training, maintenance, warranties, special support, or just about anything else he can think of. The idea here is that once you've gotten so far that you can practically taste the sale, you'll be reluctant to sink the deal over a relatively minor matter.

The “just this once” trick relies on the promise of future business to get a special deal or other consideration out of the salesperson. The prospect will say something like, "This quarter I just don't have the budget to pay full price on your product, but if you can give me a special deal now we'll be able to do plenty of business in the future." Of course, if you do come through with the special price, then the next time the prospect will demand that he get the same price and will want to know why you're “suddenly” asking for so much more money for the same item.

How you respond to the above tactics will depend on your perception of the deal and the prospect's attitude. If you really need the deal and you're sure the concessions are quite minor, you might just let the prospect “win.” On the other hand, if the prospect thinks you're a weak negotiator he'll push ten times harder the next time you try to sell him something. The best approach might be to compromise – refuse to yield on one or two points but let him have the third. That way the prospect feels like he got away with something, but still respects your refusal to fall apart at the first sign of pressure.