If you run a business, negotiations are your everyday routine. Especially, if you are an entrepreneur, you might find yourself in various tough negotiations often whether it is with clients or investors. That’s why it is crucial for young entrepreneurs to understand how to carry out a win-win negotiation where all parties benefit mutually instead of too competitive ones where one party stands to lose instead of gaining. This practice can build long-term relationships and networks which may add great value in future.
Key Principles
To carry out a win-win negotiation both parties must adhere to some basic principles of negotiating. Following these principles you can gain respect from the other end of the table and progress with the negotiation smoothly.
- Mutual Respect: Any successful negotiations start from mutual respect towards each other. If it is absent in any party, the meeting will start on the wrong foot and only sour as it progresses.
- Open Communication: Being honest and open when discussing terms is key to having a successful negotiation. Do not be afraid to share your relevant thoughts that could add value to the conversation.
- Collaborative Problem Solving: This feat is something even many veteran businessmen do not work upon. Instead of going at each other, try working together and leverage each other’s strength to solve the problems.
Have a Clear Strategy
If you want to successfully handle negotiations, you must have strategies placed beforehand. First of all, you need to research extensively and prepare your pitch before sitting with the parties. Try to understand not only your needs but also there is so you can somewhat predict and prepare for what they ask. Listen actively; Building rapport and goodwill is just the primary aspect of listening. You can even uncover any underlying interests and make an opportunity out of it. Do not be rigid in the meetings. If you are not flexible with your demands, then that is not a negotiation anymore, it’s a asking. Identify common grounds to start and progress from there. You may identify shared goals which both parties can leverage to their benefit.
Maintain Confidence and Professionalism
Most of us had a moment where we faced such difficult negotiators that many lost their nerves. Every once in a while you will come across parties that may seem tough to find common grounds with. The best approach is to maintain professionalism and focus on common interests and repeat it until they are ready to give space. There also comes a time, specially for entrepreneurs looking for funding/investment capital where the power balance in the table is shifted completely from the beginning. This can make the negotiator on the high horse lose confidence and give away the advantage and surrender. In these cases, you must stand your ground and be confident. Express concern if you are not being valued or heard at all. Maintaining ethical standards and integrity is very important at the negotiation table. If you try to exploit unfair advantages just because you can, you may gain short term advantages but it will damage your reputation and goodwill significantly in the long term.
What Win-Win Negotiations Look Like
In the late 1990’s, Starbucks and Barnes & Noble entered into a partnership that we can call an ultimate example of win-win deals. Both companies were trying to up their customer experience game and expand their market. On one hand, Starbucks wanted to expand to new locations and on the other, Barnes & Nobles had the vision to create a more inviting atmosphere in their stores. Both parties agreed to a partnership and sharing of the location where Starbucks will operate inside Barnes bookstores. Look at what they achieved by finding a common ground: Barnes customers got to enjoy the convenience of having a cafe inside the bookstore and Starbucks gained a whole new customer base. Now that’s a deal!
So, get rid of the negotiation phobia. Start implementing these strategies in your negotiations starting from today and become the Master Negotiator!
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