I frequently hear that every one of us is selling and we need to understand how to sell.? Actually I think that we are all always negotiating and it?s critical to have good negotiation skills and to set negotiation boundaries when others have an impact on whatever is being negotiated.
Exploring what?s happening in a couple of businesses right now, I?ve seen one group doing a really great job of bringing in the business.? However when matters are looked at more closely, valuable profit margin was left on the table.? Business survival is largely dependent upon understanding and working to the profit margin that you need to stay in business, but even more importantly, to grow and serve your customers.
Sometimes the salespeople in their desire to close the business will automatically drop the price without thinking about or having a discussion on the consequences of that move.? Further the customer may have only asked a question for clarification and the salesperson dropped the price.
This happened in a recent business transaction that I had with a vendor.? After reviewing their invoice, I called to get a better understanding of what they were charging.? Immediately the vendor knocked $1,500 off the price.? I happily took the discount, but I had no intention of asking for it.
Since it?s important to keep the profit margins at a certain level, there would be other opportunities for negotiations such as the delivery time frame, the quantity, the packaging, etc.? Look for how the business can be scaled up whenever a concession is made or discussed.
Recently a consultant I know had submitted a training proposal to a major company in Houston.? She told me that the company asked for a discount on the training and my friend didn?t know what to do.? As we discussed it, she said she had already given them the best price that she possibly could.
I gave her another viewpoint when I said that?s what they want to know.? They don?t want to overpay and they also don?t want to squeeze her so she?s not profitable.? It?s their duty to ask if there could be any movement on the price, but it doesn?t necessarily mean there has to be movement in order to secure the business.? She successfully closed that business without having to make a concession on the price.
What happens when sales does a good job of bringing in the business, but the technical staff, customer support, warehouse, etc. make costly and unnecessary errors??? Do they automatically decide to give products or services away to appease the customers?? When this happens, the profit margin has just been reduced.
A few months back while waiting for my household shipment to arrive in New York, I rented some furniture for the 2-week gap.? When the furniture was delivered, the table was missing.? I called the company and they said ?Sorry.? We will deliver it the day after tomorrow.?
This was completely unacceptable to me because I was paying a month?s rent for 2 weeks and I wanted what I ordered as agreed.? He then offered to take it off the bill.? There goes some profit margin.? I called the salesperson and she pulled out the stops and had the table delivered to me that evening and saved the deal.
Go to http://www.susanbagyura.com/audio/negotiations.html to hear some tips on how you can establish negotiation boundaries for your sales, service and support.
Susan Bagyura, leadership coach and Author of The Visionary Leader, shows leaders how to improve their profit margins better, faster and easier than they ever dreamed possible.
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