Customer Experience News & Trends

Strategies for negotiating when the customer holds all the cards

When it seems as if customers hold all the cards — as in today’s market — negotiating with them can be difficult. Difficult, yes. Impossible, no.

Even in a down economy, customers are buying and prospects are being visited by your competitors. Even in down periods, selective buyers will not automatically choose the lowest price. They try to determine the best value.

Risk aversion

For some salespeople, negotiating in hard times starts and ends with price. They think the only way they can conclude a successful negotiation is to make price concessions.

Most prospects worry less about price and more about risk aversion. They don’t want to make buying mistakes that can put their companies in risky positions.

Salespeople who do a good job of understanding and meeting customer needs usually don’t have to discount when they get to the negotiating table.

By clarifying and developing the value offered to customers and by skillfully negotiating after that value is establish, your salespeople can shift the emphasis from “lowest price” to “best deal.”

Create interest immediately

If your salespeople don’t create interest immediately, they may not get a chance to negotiate. Here are tips from Neil Rackham, sales consultant, on how to open negotiations successfully. Share them with your salespeople.

  • Make your opening statement short, understandable and credible. Establish who you are, why you’re there and why the prospect should be interested in what you have to say.
  • Let the prospect do most of the talking. The more prospects talk, the better you will understand their needs. Ask questions that will help you assess the prospect’s real needs and establish your role as the seeker of information and the prospect’s role as the provider of information.
  • Resist the temptation to offer any immediate solutions until you have a complete understanding of the prospect’s needs and are ready to offer credible solutions. The more you know up front, the more comfortable prospects feel in exchanging sensitive business information. Summarize key points. Define the problem and put common interests on the table.
  • Be patient. Don’t rush the negotiation. Hear out your prospect and try to keep an open mind. If you can stay flexible, you may end up with a better deal that you originally thought possible.

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