I’m on a roll here with the 80 / 20 magic. Your feedback (and I thank you) has been off the charts positive
There are MANY that can teach you negotiation far better than I.
But I can tell you that when I was in my early 30’s I negotiated a huge $750,000 deal.
I created the vision…. sat with the lawyers, helped draw up the contracts, found my ideal prospect, closed the deal myself…
Got it signed, sealed, and delivered… Bingo, Bango, Bongo.
As I look back… here’s what I learned as far as 80 / 20 relates to negotiation.
Mega successful business owners are mega-successful negotiators.
No one wants to feel like they’re ‘losing’ or ‘giving too much’ so you need the other party to feel like they’re having a win.
1. Manage your psychology, be aggressively patient, and be willing to WALK AWAY.
2. Have faith that ‘good deals’ come together and ‘bad deals’ fall apart.
My mentor told me that ‘deals are like busses… there’s always another one coming.’
3. YOU draft the agreements (not them) where and if possible. Start with a Memorandum of Understanding (MOU) prior to spending too much time and money.
4. Negotiations can be predictable. Allocate more time to planning the negotiation rather than making decisions as you go.
5. As part of intelligent planning establish items you’re willing to dramatically move on / eliminate and also a list of your must-haves.
Mentally move to the other side of the table and establish what you assume are the other parties ‘must-haves’ and areas they’re willing to move on.
6. When coming to an agreement, of any kind, 20 percent of the points in the agreement will result in 80% of the value.
As negotiations move along concede some of the points in the 80% so the other party feels the win.
7. 80% of the negotiation will come together in the last 20% of the time. An amateur will rush everything…. Don’t rush and don’t give away your 20% cause you’re impatient (see point #2).
8. In consideration of #4, pace your negotiation to address the most critical parts as the deadline approaches. Assuming the deal is a good one and coming together (see #1) the other party is far more likely to be flexible at the later stages than the earlier
negotiations.
Assuming a territory deal…
An example would be ‘first right of refusal’ on the territory besides the one they’re purchasing.
A small-scale example with your clients is when they buy from a supplier…
“I’ll buy exclusively from you provided you’ll give me 60-day terms or a 7% discount when I pay upfront.”
The mistake many clients make… they don’t negotiate.
They avoid it!
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