Whether it’s to win a project or to fund a new opportunity, sales negotiation is a key component of the sales process.
To simplify the process, I’ve put together a five-step acronym to help you and your team through the sales negotiation process.
Read on to discover more on the AGREE acronym.
How to AGREE in a Sales Negotiation
Looking to navigate the sales process in the right direction? Follow these steps during a sales negotiation.
In the end, everyone will AGREE.
First, align on pain points to establish yourself as a problem-solver in your sales negotiation.
Position the discussion from cost to investment. People invest to make a problem go away. And in a cost discussion, they’re focused on “giving up” a part of their budget.
An example for how you might apply this in your sales negotiation conversation:
“Can I confirm your team’s inability to reach the right audience for your new widget? Are you still focused on solving the problem of a weak brand message coming from your marketing department? Are there other issues related to this initiative before we finalize terms? I want to make sure we are on the same page about your priorities.”
Next, get the level of urgency for your solution. This will lay the groundwork for the rest of your sales negotiation.
It’s imperative to find out if other stakeholders share the same level of urgency.
An example for how to include other decision makers:
“Does John in marketing share your level of urgency? Can you expand on why he’s interested in doing this project now versus putting it off or not doing it at all?”
It’s critical that you respect the political situation while making a sale.
Politics often plays into a sales negotiation. People’s credibility can be a determining factor in persuading others in a company to buy into an initiative.
Some examples of how to handle politics in a company include:
- Leveraging internal champions to negotiate your pricing on your behalf.
- Dealing with some of the objections your customer might receive behind the scenes.
- Turning your buyer into an ally because you will make them look good.
Now it’s time to establish a price.
You might choose to give a price range rather than a firm number. This gives you some wiggle room as you progress further.
I recommend you establish a price towards the end of your sales negotiation. This allows you to put pricing in the context of a solution that will benefit your buyer.
An important part of your sales negotiation is to have flexibility built into your pricing, but not too much. Don’t artificially inflate your numbers so you can quickly lower your price. You don’t want your customer to think that you can’t be trusted to deliver a fair and accurate price out of the gate.
Be prepared to change the pricing parameters in exchange for removing certain elements in your offering.
For example: “Jane, in order to meet your budget, we will need to reduce the number of onsite equipment maintenance visits.”
Think win/win. Your customer wants to pay you a fair price and not just get a bargain at your expense.
Lastly, it’s important to energize your relationship.
What do I mean?
Don’t take your relationship for granted. The more you energize your relationship, the stronger the emotional connection. Put positive energy into your sales negotiation.
Take stock of how much they like and trust you. How likely is this buyer to deal with someone else? Is your relationship strong enough for no hard feelings, regardless of winning the deal or not?
An example of how to energize your relationship:
“Heather, we’ve know each other a long time and I’m really grateful for our relationship. I hope you feel the same way. At the end of this negotiation, regardless of how it works out, I promise to continue to honor our friendship.”
Here’s a quick recap and a phrase to recall the AGREE acronym:
“Aligning Gets Respect Establishing Energy.”