Does the prospect of negotiating with an employer, investor, or business partner make you cringe? Do you shudder at the thought of sitting across a table from someone and driving a hard bargain? You’re not alone. So to give you a boost, here are 4 effective approaches to negotiate like a pro:
1. Know Your Worth
Before you even entertain the idea of meeting with a potential employer or business partner, you need to have a clear idea of where you stand in comparison to the ‘average’ company or employee. Databases such as the US Bureau of Labor Statistics, and sites like PayScale, can help you determine the average salary your position earns nationwide and in your area.
Once you have a ballpark idea of what the average employee in your position earns, you can negotiate for more by differentiating yourself from the herd. Provide concrete evidence that you deserve more than the median, by using specific examples of your past performance as leverage. If you’ve been offered a position, your interviewer already believes you to be a cut above the rest. Knowing this, you have no reason to settle for a baseline offer.
2. Know Where The Other Party Stands
Now that you know what you want to get out of a negotiation session, and you’re clear on what you have to offer to warrant that outcome, you need to know what your counterpart is capable of giving you. For business-to-business deals, you’ll want to know as much as you can about what the other party is looking to (or needs to) get out of the agreement. Why? Because you want to be able to provide for these specific needs of your counterpart, with the hopes that doing so will make them waver a bit on their initial position.
There may also be terms that your counterpart simply will not budge on, no matter what you offer to try and sweeten the deal. Find out what these terms are early on, so you don’t waste time or annoy your counterpart by discussing them.
3. Keep Your Priorities Straight
You know what you have to offer, and you know what your counterpart can offer. Now you need to be ready to stand your ground. In other words, you need to determine exactly what you want to get out of a negotiation session—and what you’re willing to give up.
Whether you’re an individual negotiating an employment contract or the head of a company entering into a business agreement, you need to keep your priorities straight. You can do this by knowing the best alternative to a negotiated agreement, and the worst alternative to a negotiated agreement. This will help you understand which points of an agreement you’re willing to negotiate or waver on, and which issues you want to stand firm on.
Consider as many variables as possible before entering into negotiations, then prioritize them. The importance you place on each variable will help you determine whether the terms your counterpart offers fall within what you want, or if you’re better else shopping around for a better deal.
4. Always Be Anticipatory and Objective
This piece of advice goes along with the main points we’ve discussed in this article: knowing what each party wants and what value can be offered. But knowing initial intentions is only the beginning of creating an effective negotiation strategy.
To take your negotiation skills to the next level, you’ll want to anticipate how the entire session will play out. This requires you to be as objective as possible, removing any biases you may have toward your own cause. In short, you’re trying to determine how your hypothesis will stack up to reality.
Also remember, using these 4 negotiating skills can help you in pretty much any area of your life, not just business.