TSS 2010: skill 4 - Negotiating

Sitting alongside senior business leaders to help keep

them on the business flight plan

Negotiating skills

How to Negotiate and keep your profits

Me? Negotiate?• I cant negotiate

• I do not have the confidence

• I do not have the skills

• They know more than I do

• How can I tell if they are lying

The negotiation is the end of the journey, not the beginning

3 P’s of negotiations

• Profit• Purpose• Preparation

An exchange of VALUENot an exchange of money

How are profits made?

Sales income-

Costs=

Profit

How to increase profit?

Increased sales income-

Lower costs=

Increased profit

Example

Sales income = £10,000

Costs = £8,000

Profit = £2,000

Example

Sales income = £10,000 + 10% = £11,000

Costs = £8,000 = £8,000

Profit = £2,000 = £3,000

% = 20% = 27%

Example

Sales income = £10,000 = £10,000

Costs = £8,000 -10% = £7,200

Profit = £2,000 = £2,800

% = 20% = 28%

Example

Sales income = £10,000 +10% = £11,000

Costs = £8,000 -10% = £7,200

Profit = £2,000 = £3,800

% = 20% = 35%

Example

Sales income = £10,000 -10% = £9,000

Costs = £8,000 + 10% = £8,800

Profit = £2,000 = £200

% = 20% = Zip!

Purpose

• What do you want to achieve?• Get the business! • Long term or short term deal• Trophy client or introductory offer• Training upsale• Multi year support contract• Referral client• Value exchange – what can they give you• Equity for discount

Preparation

Do the thinking in advanceThe heavy lifting

Scenario plan to assess what could happen

Negotiation zone

Seller - Entry point

The Highest point at which they will enter the

negotiation

Seller - Exit point

The Lowest point at which they will exit the

negotiation

Buyer - Entry point

The Lowest point at which they will enter

the negotiation

Buyer - Exit point

The Highest point at which they will exit

the negotiation

Trading – swopping value

• Not haggling – commoditising on price

• What do you have that clients value?

• What do clients have that you value?

If you can do this for me,

then I will do this for you.

Need to understand the client’s pain

Thank you!

Robert Hook07956 532963

robh@businesscopilot.co.uk