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Negotiating for Sales


Overview
This module is designed to give you a structured approach for carrying out negotiations. Emphasis is placed on the differences between selling and negotiating. The module has frameworks designed to help with your preparation, putting forward proposals and guidelines on negotiating techniques. Advice is also given on how to conclude the negotiating process, resulting in your customer's needs being satisfied.


Introduction

When you are conducting a sale with a customer it is quite probable that there will be an element of negotiation involved. In some selling situations you will be involved in extensive negotiations.

At its’ simplest level, negotiation is where you discuss something with a customer in order to reach an agreement e.g. you will negotiate the date when your product will be delivered, the trade in value for a product/service or the price of the product/service that you are selling. An essential ingredient in the process of negotiation is the act of bargaining, where both you and the customer will initially state your position and then by a process of give and take will eventually reach an agreement that you are both satisfied with. The amount of negotiation you are involved in will really depend upon how much discretion you are given by your organisation and in particular by your sales manager. It also will depend on what you are selling.

If the products or services you are selling are standardised, nationally advertised and have set prices and fixed delivery dates, you will probably be involved in very little negotiation. You might only be involved in negotiating the volume to be ordered. Where there is a minimum order volume, your negotiation involvement will be even less. Nevertheless, it is likely that you will be involved in a good deal of negotiation throughout your selling career and will be given significant discretion and freedom to negotiate by your sales manager as your career progresses.

One important point should be born in mind, and that is the crucial distinction between selling and negotiation. Selling is where you are concerned with identifying the customer’s needs and interests and convincing them that they should purchase from you by stressing the benefits of your products or services, by applying the benefits to the customer’s needs and interests and by overcoming their objections. Selling is about finding solutions to customer’s needs and building relationships on trust. You should see yourself as an extension of the customer’s organisation. You are there to help provide solutions to their problems. Only when the customer focuses on the terms and conditions of purchasing your product or service do you begin to move into the arena of negotiation.

Where you have little or no scope for negotiation you are really involved in what might be referred to as pure selling. Where you are involved in negotiations for what you sell, it can be described as sales negotiation.

Negotiation is a fundamental element in the selling process and by its’ effective use you will be able to enhance your selling achievements e.g. you will be able to agree a higher price. This will benefit both your organisation and you, via the additional commission you will generate. In addition, anything that enhances your selling achievements, such as successful negotiation, will have positive results on your selling career in general.

There are three essential components to a successful negotiation:
1. Effectively planning the negotiation
2. Creating the proposals with the customer.
3. Agreeing the outcome of the proposals and the conditions of sale with the customer.



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Overview: Negotiating for sales
This module is designed to give you a structured approach for carrying out negotiations. Emphasis is placed on the differences between selling and negotiating. The module has frameworks designed to help with your preparation, putting forward proposals and guidelines on negotiating techniques. Advice is also given on how to conclude the negotiating process, resulting in your customer's needs being satisfied.
Unit 1: Planning for negotiating
This unit is designed to enable you to thoroughly plan before you enter into negotiations with the customer. A framework is designed which helps you establish your initial negotiation position via an assessment of the customers' needs. Advice is given on the importance of objective setting and on specifying the boundaries for the principal negotiating factors. Advice is also given on establishing the roles of the individual members of the DMU (decision making unit) and on accessing all the resources needed for the negotiations.
Unit 2: Creating proposals with the customer
This unit is designed to help you create a clear understanding of the customers' position over each proposal. A framework is designed which helps you structure your negotiations, with an emphasis on effective communications, making use of empathy and creating the right relationship with the customer. Guidelines are given on body language, buying signals and negotiating techniques.
Unit 3: Agreeing on the outcome of the proposals and conditions of sale
This unit is designed to help you reach a full agreement on the final proposals, with both parties being satisfied with the outcome. An emphasis is placed on making sure the customers' needs are satisfied by accurately summarising the outcome of each agreed proposal. A framework is designed to help you record and document the conditions of the sale with guidelines on the relevant legal areas.