Having confidence in your strengths and in your plan is critical in tough negotiations. In fact, it’s often the deciding factor in whether or not you achieve a “good deal”. Confidence stems from knowing where your power lies, and how you can leverage it to get the deal you want.
Here are four useful perspectives to help you get that understanding.
People: List out all of your key contacts in their business, and what their priorities would be for the negotiation. Look for these five angles: who is the lead negotiator; who really pulls the strings; who would have the biggest issue if you couldn’t reach a deal; who could influence the decision makers; who can you use to find out information.
Power: Note down out all the areas you do business together - each area is likely to have a different “balance of power”. Identify which ones are most critical for you and for the other party. Which would be most painful for them, and least painful for you, if you were to pull the plug?
Period: Think about the period of the negotiation. All businesses have times where they’re under pressure to keep their trading relationships stable, like financial year-end, product launches, and promotional drives. Map out the key events that are due to happen over the negotiation period, and identify when your counterpart will be under most pressure to reach a deal.
Peers: Finally, look for ways to create internal pressure on your counterparts through their peers. Your negotiation may well affect more than one team in their business, and an irate department head with empty store shelves or idle production lines for instance, could create huge pressure for them to strike a deal.
The more you understand where and when these pressures will bite, the more confident you can be about sticking to your plan.
BOTTOM LINE: There’s a general perception that big businesses have the power to push their smaller counterparts around. But that’s only the case as long as small businesses think it is. In any negotiation, there’s always a way to apply some leverage, if only you can work out how.
This article is the first in a three part mini-series. For links to the other two, click here.