Learning how to negotiate effectively is an important skill that requires a great deal of preparation. By planning ahead and accounting for all possible outcomes, negotiators stand a better chance of reaching their desired outcome while also setting a strong foundation for future negotiations. Negotiations can be unpredictable and challenging, so knowing when to push, concede, or take a break can greatly increase the likelihood of success. Planning can mean the difference between success and failure, so consider the following tips to help you prepare for your next business negotiation.
1. Do Your Homework
Before sitting down at the negotiating table, always take time to do your research. You should come to the meeting with as much information as you can get about the person and company you are dealing with. Start by familiarizing yourself with the other party’s products, services, industry, and competitors. This will help you determine their strengths and weaknesses as well as what items are most important to them. You also need to understand your own position and what things you bring to the table.
2. Identify Your Goals
Setting clear goals is one of the most important parts of negotiation preparation. It is essential that you know what you’re aiming to accomplish. Make a list of your non-negotiables and concessions and be sure you have them prioritized. You need to have specific, tangible goals so you can steer the negotiation in the right direction. Making decisions on the fly can cause later regret.
3. Consider All Possible Scenarios
Once you have a solid understanding of both your needs as well as those of your counterpart, it’s time to hypothesize and plan for all possible outcomes. By thinking through potential scenarios, you can anticipate possible reactions and counter proposals so you will be more prepared to respond appropriately.
4. Know Your BATNA
Before approaching the bargaining table, you need to know the conditions of the negotiation. While you will likely need to compromise and make concessions in order to reach a win-win outcome, you want to be sure you don’t concede so much that it prevents you from achieving your desired outcome. Unfortunately, you may not always be able to reach an agreement with the other party, so you need to consider your best alternative to a negotiated agreement (BATNA) in case the negotiations don’t go as planned.
5. Develop a Strategy
Developing an effective negotiation strategy is another critical component of your preparation. Consider various factors including your desired outcome, priorities and interests, the other party’s goals and objectives, as well as any leverage or alternatives you have. Determine what is motivating the other party and how you can create value for them. A well-developed strategy can help you stay focused and keep the negotiations moving in the right direction.
