Here are our 5 top tips for successful sales and tender negotiations.
Proposals and informal tenders normally involve some negotiation. Formal tenders such as public sector tenders often have less scope for tender negotiations. Whichever, it is common for most deals to have some element of contract negotiation before signing on the dotted line.
These tips on sales and tender negotiations will help you get a better deal when closing contracts.
1. Fall-back Position
Before you start, establish your fall-back position eg how far you will go to win the business and when to walk away.
2. Understand their Want List
When the buyer asks you for a concession, don’t immediately give it away – even if it’s small. Ask them if there is anything else holding back the sale; you want to know everything on their ‘want list’. If you start conceding things individually, a skilled buyer will take what you’ve given and then ask for more… before too long you’ve given it all away!
3. Prioritise and Trade
Once you know the buyer’s wants, try and prioritise them in order of importance. You can then start to trade them against your wants eg if they want rebates on late deliveries, you might ask for a premium on late orders / rush deliveries.
4. Don’t Give it Away
Never give anything away without getting something back.
5. Recognise the Value of Everything
Try and trade things that have a big value to the buyer but a low cost to you e.g. expert advice or some type of review which would save the buyer lots but may not cost you much.
Sales and Tender Negotiations Summary
You can add much more to this list of sales and tender negotiations tips. But not taking these basic steps means that you are making the most fundamental mistakes made by sellers. They can make a big improvement to the profitability of a deal!
Please add any of your favourite sales negotiations top tips.