Have you ever entered a negotiation and felt you just didn\u2019t have a leg to stand on?\u00a0<\/p>\r\n\r\n\r\n\r\n
What about the other side of the table?\u00a0\u00a0Have you ever been in such a strong position that if your counterpart made objections, or asked for something, you knew you didn\u2019t have to give in?\u00a0<\/p>\r\n\r\n\r\n\r\n
Either way, what you\u2019ve experienced was that remarkable negotiating force known as \u201cleverage.\u201d Leverage in negotiating is like the undertow near the beach. We can\u2019t see it on the surface, but it\u2019s pulling powerfully beneath us.<\/p>\r\n
Developing strong negotiation skills in sales<\/a> is no easy feat. We can gain or lose negotiating leverage in various ways. But if we\u2019re not\u00a0aware of areas where we can gain leverage\u00a0<\/em>in the negotiation, we miss opportunities.<\/p>\r\n\r\n\r\n\r\n\r\n\r\n There are eight possible sources of leverage that are present in every negotiating situation. We want to understand and maximize all eight sources.\u00a0<\/p>\r\n\r\n\r\n\r\n 1. Time<\/strong><\/p>\r\n\r\n\r\n\r\n My personal choice to consider for the first kind of leverage is always time. Time encompasses both the question of when something happens in your world and the question of how what\u2019s happening in your world can be coordinated with things that are happening in your negotiating partner\u2019s world.\u00a0<\/p>\r\n\r\n\r\n\r\n Time controls everything in business. The more you understand how time and timing affect you and your negotiating partner, the better you\u2019ll be able to strategize the frequency of your discussions. In turn, this will enhance their impact overall. I\u2019ve seen managers and salespeople fall into the trap of making time a liability because they put too much pressure<\/a> on themselves to get the deal done by the end of the month\/quarter. As the end of the allotted period of time gets closer, they start to make discount offers\u2014and all too often, come across as desperate.<\/p>\r\n\r\n\r\n\r\n In order to strengthen your position regarding time, downplay any concerns about when the deal is done no matter what pressures you may be under personally. In addition to that, start asking better questions<\/a> about the buyer\u2019s timeframes. For example:<\/p>\r\n\r\n\r\n\r\n It never ceases to amaze me how many salespeople fail to ask these kinds of questions early in the process \u2013 and thereby miss an important opportunity to create leverage.<\/p>\r\n\r\n\r\n\r\n 2. Belief<\/strong><\/p>\r\n\r\n\r\n\r\n Would you buy your own product or service at the rate you\u2019re charging? Do you believe, in your gut, that your own time, attention, and expertise is worth the amount you\u2019re asking for it?<\/p>\r\n\r\n\r\n\r\n If you aren\u2019t sure, then your belief system is going to get in the way of your ability to stand firm in a negotiation situation.\u00a0<\/p>\r\n\r\n\r\n\r\n Your belief system is either an asset or a liability. If it\u2019s a liability, you may want to take a closer look at both the reality on the ground, and the thoughts circulating between your ears. Until your belief system has been upgraded to where it needs to be, you will likely falter in negotiating situations.<\/p>\r\n\r\n\r\n\r\n As David Sandler famously put it: \u201cyou are, at this moment, earning exactly what you believe you\u2019re worth, not a penny more or a penny less.\u201d\u00a0<\/p>\r\n\r\n\r\n\r\n 3. Need<\/strong><\/p>\r\n\r\n\r\n\r\n Need is a powerful factor in negotiation that is closely linked to the pain you are able to uncover\u2014the emotional distance between where the buyer is now and where they want to be.<\/p>\r\n\r\n\r\n\r\n I grew up in Pennsylvania, but I have lived in Florida for all of my adult life. Back when I was a kid living in Pennsylvania, when the furnace went out and we didn\u2019t have any heat during the winter, our need to get it fixed was great\u2014and therefore, my father\u2019s abilities to negotiate on rates were limited.<\/p>\r\n\r\n\r\n\r\n Similarly, in Florida, when our air conditioning goes out in July, our need to get it fixed is immediate. That reduces our leverage somewhat when it comes to pushing back on the rates.<\/p>\r\n\r\n\r\n\r\n How badly does your prospect or counterpart need what you have to offer? If the person you\u2019re negotiating with decides not to work with you, what is their next best alternative? Do you know?<\/p>\r\n\r\n\r\n\r\n Let\u2019s pretend that in order to hit your numbers, keep your job, stay in business, whatever, you must\u00a0<\/em>close this sale\u2014and, from your behavior, your negotiating partner learns that. Congratulations: You\u2019ve created a liability. Naturally, an experienced negotiator will take advantage of this dynamic if they have leverage in terms of need.\u00a0<\/p>\r\n\r\n\r\n\r\n 4. Emotion<\/strong><\/p>\r\n\r\n\r\n\r\n People buy emotionally and then justify their decisions logically.<\/p>\r\n\r\n\r\n\r\n This pattern is evident in any and every case of buyer\u2019s remorse. People are drawn in emotionally, and then once the emotions recede a bit, the intellectual side of their brain kicks in and they decide they\u2019ve made an unwise decision.<\/p>\r\n\r\n\r\n\r\n Your ability to control your emotions<\/a> during any negotiation is potentially a huge area of leverage. Knowing when and how to step away from impulsive, emotional responses\u2014especially when that\u2019s the kind of reaction an experienced negotiator is hoping to elicit\u2014will help you think straight, put things in the proper perspective, and respond with the right tactics and strategies.<\/p>\r\n\r\n\r\n\r\n 5. Relationship<\/strong><\/p>\r\n\r\n\r\n\r\n Would you be likely to negotiate harder or easier with someone you knew really, really well?<\/p>\r\n\r\n\r\n\r\n Naturally, some people will make choices that prove to be the exception, but the reliable rule that I have seen play out is that the more I know and trust someone, and the more they know and trust me, the less likely they are to expect major concessions from me. They are far more likely to feel they are already receiving a fair deal from a person they know and trust. They want to support and sustain the relationship with me over time.\u00a0<\/p>\r\n\r\n\r\n\r\n 6. Understanding<\/strong><\/p>\r\n\r\n\r\n\r\n You might not have thought of \u2018understanding\u2019 as a source of leverage, but it is a powerful one.<\/p>\r\n\r\n\r\n\r\n Are you able to put yourself in your counterpart\u2019s world and understand their point of view, their business, their industry, their market, their motives? When they take a certain negotiating position, do you understand what made them take that position? Do you understand the kinds of chess moves that their leadership is trying to make? Do you understand their mission?<\/p>\r\n\r\n\r\n\r\n Yes, all of this is easier said than done. Gaining leverage in this area requires you to do some research and spend some time being an investigator. But you will find, I believe, that it is an investment that can pay huge dividends.<\/p>\r\n\r\n\r\n\r\n It all comes down to effective questioning. Questions that help you and the other person to \u201cmonetize\u201d the problem as it stands\u2014 that is, figure out how much leaving it unsolved actually costs\u2014are particularly important here.\u00a0<\/p>\r\n\r\n\r\n\r\n 7. Ownership<\/strong><\/p>\r\n\r\n\r\n\r\n Ownership means personal, emotional investment in the specific solution that is being proposed or discussed. You gain leverage in any negotiation situation whenever the other side puts their fingerprints on the solution being developed\u2014by them making a suggestion or revision, by asking others in their organization to provide feedback<\/a>, or by adding an idea of their own to one of your ideas. Effective negotiators are good at soliciting fingerprints.<\/p>\r\n\r\n\r\n\r\n Before you make a formal recommendation, stop and ask yourself: is any part of what you are about to propose co-created by you and the prospect in order to involve ownership on both sides? If the answer is no, you are giving up leverage.<\/p>\r\n\r\n\r\n\r\n\r\n