Good negotiation skills can never be overlooked for running a business successfully. Whenever you are running a business, a major part of what you do will involve transacting with other people. These people could be your suppliers, vendors, your customers, your bankers, landlords etc. Virtually every single key that you do in a business will be about transacting with another person. If you do these deals without negotiating or not being prepared to negotiate, you are in a way undermining your business potential.
Negotiation happens at all levels of a business. Right from the time that you start approaching bankers and lenders to give you money to start your business or you need investors to invest in your business so you can grow, you will need to negotiate. If you are looking for office space for your business, you should negotiate with the landlord. Even when it comes to selling your service or product to a consumer, you will probably face negotiation.
Before you can market your product to other wholesalers or retailers, you would have to negotiate for their own profit margin. Basically, if you ignore this important skill, it could be a possible setback to your business.
Even if you do succeed and do make a profit, you are not maximizing your business potential if you are not negotiating wherever you can.
Most of the people are scared of having to negotiate. Most of the people and especially the first-time entrepreneurs are extremely shaky about their ability to negotiate successfully. They are hesitant to do so. And not without good reason.
Negotiating can be a lot about play acting and may even require you to get aggressive.
Negotiating can also put you on the very edge of having to turn down a deal that you sorely want. But you must understand that when you’re in a business, negotiating the best possible deal for yourself is the highest priority.
Specially when the transactions are of the long-term nature, putting yourself through the initial discomfort and getting the best deal possible can save you hundreds of thousands of dollars in the long run. Basically, you shouldn’t be hesitant or self-conscious when you negotiate.
While larger companies have the luxury of being able to hire other people to do the negotiating for them, these people being professional negotiators, as a small business owner, you will probably not have this luxury. As a small business owner you need to step in to this important position and fulfill the role as a negotiator for your business. In our next few posts we will discuss what is business negotiation and how you can prepare yourself to negotiate well on business deals.