It's never too late to negotiate better
It’s negotiation season - getting late in the quarter and late in the year, and nearly every seller I’ve spoken with plans on a big December. The outcomes of your negotiations in the next four weeks will have an outsized impact on your year.
There are three things you must consider - Strategy, Position, and BATNA.
Your first priority should be to have a negotiation strategy. Written down, and reviewed with your manager and others.
As Alvin Toffler said, “If you don’t have a strategy, you’re part of someone else’s strategy.”
Here are the components of a good negotiation strategy:
Goal - what are your aspirations - not just pricing, but all relevant terms. Answer this for yourself and your best guess for the buyer.
BATNA - the Best Alternative to a Negotiated Agreement. Also, answer for yourself and your buyer. More on this below.
Walk-away - the least you will accept - this is the point at which your BATNA is more attractive than this opportunity.
Position - where you are positioned, relative strengths versus any remaining competition, and other uses of the budget you are seeking.
Concession Plan - what you expect they will ask for and what you will trade for in return. Everything above (Goal, Walk-away, Position) sets the stage to think through this.
Process - the timeline of events as you would like them to unfold. Ideally, this is started in your MAP (Mutual Action Plan). In my experience, this needs to become daily and even hourly as you get close to the end and are competing for attention amidst the multitude of other transactions the buying team is processing, plus holiday and vacation time.
Participants - for larger deals with a buying team, it’s valuable to map out all the players, their roles, and anticipated demands in the process.
Your second priority is to improve your position. A better value proposition, more ROI, stronger executive relationships, more influencers, and a stronger commercial offer. Never stop selling. There is no “almost-there” finish line. Never think, “We’ve won, we’re VOC, now we just need to get through contracting.” Typically the seller’s position erodes during negotiations. The entire procurement playbook is built to force that. So at a minimum, you are at least maintaining, and any improvement will help.
Your third priority is continually improving your BATNA - your Best Alternative to a Negotiated Agreement. By making your BATNA better, you improve everything about your negotiation - the strategy, the position, the outcome.
Don’t think, “I don’t have a BATNA. I have to have this deal, there is nothing else. No pile of other opportunities to be dipped into.” You always have one, even if it is a worst-case scenario.
Start with that - the worst-case scenario - you lose the deal at midnight on 12/31 after spending 100% of your time on it. The first improvement - lose earlier. Push to be sure you’re not ‘column fodder’ - the 2nd or 3rd option.
Then consider if you lose early, what will you work on?
Time on other deals - late stage and upside, early stage and strategic, all of them.
Defining a much smaller deal - a pilot/POC vs. the full transaction.
Build pipeline for January / Q1.
Build relationships - in your network, existing customers, partners
Do all of it. It will help. Some upside deals move faster than expected. Relationships have unexpected connections. Ideas that pop up in another transaction are relevant in this one.
And - most importantly - it will change your mindset. Reduce neediness. Give you perspective, power, and positivity. You’ve done all the work to get yourself here. Build the mental power to finish strong because, at this point, 90% of negotiation is mindset.
