Every business needs a competitive advantage to distinguish itself from the competition. Especially in today’s economy, every advantage counts to help your business earn its way to the top spot. This same principle is true when it comes to business negotiations. In order to negotiate the best deal, it’s important to identify the specific factors that give you an edge over your competitors and use these factors to your advantage. Here are a few helpful tips for how you can use the competitive advantage factor in your next business negotiation.
Define Your Competitive Advantage
In order to gain a competitive advantage, you must first have a clear understanding of what that is for your company. What exactly distinguishes your company from others and will make the customer more likely to choose you over the competition? Without a defined competitive advantage, you have no unique method for negotiating with customers. It is important to discover how your company can create value for customers in a way that your competitors cannot. Perhaps you have the cheapest price, the highest quality, faster service, unmatched convenience. Understanding your specific competitive advantage allows you to build a negotiation discussion around those specific strengths.
Seek to Understand the Customer
It is important to gather as much information as possible about your customers. What type of service are they looking for? Who do they typically do business with? What is their budget? Furthermore, you need to identify their specific pain points so you can use your strengths to provide a perfect solution. When you fully understand your customer and their needs, you are then able to explain how your competitive advantage factor will help them. In short, the first step in competitive negotiations is listening to your customers and understanding their needs.
Explain Your Strengths
Ask yourself, “Why do customers buy from me?” Is it because you have the best price, the best quality, the best customer service? The answer to this question will help you understand what value you can bring to the table. By creating value for the customer, you will have the upper hand when it comes to negotiating. You are essentially offering the customer something they can’t refuse and your company’s strengths are working to give you a great advantage in the negotiation.
Look at Your Competitors
Competitive advantage means you offer something your competitors don’t. This means you have to know what your competitors do well and what they don’t do well. Think about your competitors’ products, services, prices, location, and policies and compile a list of why you think you would better serve this customer. During the negotiation, bring up a few of these points and make the customer understand why your company is the best choice.
Focus on Solutions
You could spend all day talking about how great your company is but if you don’t provide a solution for your customers then your product or service has no value. Remember to stay focused on providing solutions during your negotiation. Identify the needs of the customer and then explain how your company’s strengths can meet those needs. Negotiating is all about creating solutions so you can increase revenue and satisfy customers by using a competitive advantage factor in your negotiation.
