When you go into a negotiation meeting, the end goal is to close the deal and find a solution that benefits both parties. However, it isn't always possible to come to a suitable conclusion.
Sometimes, it's best to walk away from the negotiation process without a deal, particularly if you and the vendor can't see eye to eye. While it can be tempting to accept terms you're unhappy with, the negative impact you face when committing to unfavorable terms isn't worth the risk.
During any negotiation, you must take two sets of interests into consideration: your firm's interests and those of the counterparty. Identifying the similarities and differences in each party's areas of interest early on allows you to assess whether or not you're a good match.
To understand more about your own interests, ask these questions:
What do you want to gain?
What needs to change for you to be satisfied with the deal?
To understand more about the interests of your counterparty, ask:
Why are you asking for X amount?
What happens if I don't give you X amount?
If you discover the interests of the vendor don't match up with your own, it may be time to walk.
The values and ethical stance of your business have a large impact on your customers, clients, and even your employees. Compromising those values for the sake of closing a deal may have an impact on those who choose to do business with you and the people who work with you. Therefore, it's essential to compare your business's values with those of the counterparty to ensure they're a good fit for you.
Negotiations can take weeks or months to complete, so it's understandable that business owners want to close deals with as little hassle as possible. This desire to come to an agreement can sometimes make people lose sight of their desired outcomes and agree to bad terms.
However, accepting unwanted terms is never a good idea and can result in:
Losing a sale
Disrupting employee satisfaction
Even the best negotiators sometimes let go of deals. In many cases, walking away from a negotiation that isn't quite right isn't a failure and is actually a win.
Walking away from a deal is beneficial if:
The parties are a poor fit for one another.
It's not the right time.
The vendor becomes too pushy.
The vendor wants you to agree to bad or unethical terms.
Before a negotiation meeting, consider the appearance of your proposed contract. A well-presented, professional-looking proposal makes a successful negotiation more likely. Include all relevant information, and proofread carefully. Be sure to convert JPG to PDF online for the final product preserves formatting when the document is opened on an electronic device, making your contract look professional.
Having the confidence to walk away from a bad deal or a negotiation that isn't going the way you want is an important skill and can prevent negative effects on your business.
For more advice on when to walk away from a deal, consider joining your local chamber of commerce.
This Hot Deal is promoted by Davie-Cooper City Chamber of Commerce.