How to negotiate and win

Negotiating is a key aspect of managing any business, be it large or small. Being a good negotiator can win you important contracts and save on your expenses. With a bit of forethought and practice, you can get more out of other people and still leave the door open for further business.

Key points

• Consider exactly what you hope to achieve from the negotiation before you get to it. This leaves you free to focus your attention on the action as it happens.
• Remember that a negotiation involves more than just you. If you can identify their targets early on, ideally before the negotiating begins, you will be in a better position to control proceedings.
• Think in terms of a 'win-win' situation. Aim to create the impression that everyone will benefit from the deal.

Issues to consider

Avoid going into a negotiation blind. Most meetings are not thought out and are thus unstructured. The more prepared you are for them, the fewer surprises you will receive, and you won't be left searching for the correct response at a crucial moment.

Try to conceal your own aims and interests in the negotiation. If the other party can see what you need, they will use it against you. However, if they already know, try playing down your concerns: 'Yes, this is a concern in this area - but it's not crucial to our overall outlook.'

Know your own pre-set limits and stick to them. Don't get caught up in the rush to close the deal. Flexibility is important, but your limits are there to protect you from heat-of-the-moment reactions.

Avoid being vague and undermining yourself. For example, 'We were looking at a normal fee of about £6,000. How does that sound?' is riddled with signs of doubt and flexibility. It invites the other party to go on the offensive. The shorter your speeches are, the more prepared and assertive you will sound. So state your offer, 'We charge £6,000', and shut up.

Don't think of a negotiation as a one off, all-or-nothing contest. Even if you come out having made concessions and without all of your goals achieved, it is just as important that you build a good relationship with your clients. If there are no hard feelings this time, it will be easier to go back in the future.

Try to avoid appearing to 'win' a point.

Only make a final offer as a last resort. If you've been playing your part properly, you will reach an agreement you both like together. If you have to make a final offer, know how you will respond if they reject it.

Best negotiation practice

• Think through all possible scenarios beforehand - what you'll accept, what you won't, what you'll concede and so on.
• Try to find variables that are good for both of you - something you value but which costs them little, or vice versa. For example, free delivery or 60 days credit.
• Always trade concessions - 'If you do this, I will do that.' Never give them away. Have alternatives up your sleeve.· Be realistic in your demands or concessions or you will weaken your credibility.

Insider's tricks

If you're clever, you can subtly pile on the pressure. For example, you might say, 'We've invited you here because we've heard you know a lot about X. We normally use Good Consulting. They've put in a proposal and we're quite happy with it, but we thought we'd give you a chance in view of your expertise.'

Make your initial position distant from theirs, but not so much that they walk away. It is then easier to concede ground, which is always well received.

Always 'flinch' at their first proposal, otherwise you will give the impression that you accept it, or are at least close to doing so. Use the 'salami' technique on others - break up the deal into smaller, discrete chunks. Chop it into terms, add-ons, price and so on, until you arrive at the nub of the matter. This creates a momentum of agreement, but can be dangerous if you end up with nothing but the price between you.

Counter someone who tries to 'salami' you with a 'package deal', and insist that everything is an integral part of the agreement.

Finally, once you have agreed a deal, use your body language to close the meeting - close your papers, remove your glasses. Above all, shut up.