What's the one thing you need for a successful business negotiation?
"Don't give the other side leverage by thinking you don't know what you're doing," says Eldonna Lewis-Fernandez, a retired Air Force veteran and author of "Think Like a Negotiator: 50 Ways to Create Win-Win Results by Understanding the Pitfalls to Avoid."
"Do your homework," she says. "If you're going in to negotiate, you need to prepare in advance. Find out what the company is about and who the decision-maker is. Find out how many people will have to sign off on your deal. Make sure you know ahead of time what kind of deal you received in earlier negotiations."
Lewis-Fernandez spent many years in the military as a commodity buyer to keep Air Force bases stocked. That experience helped her develop a checklist of tips for negotiations. See if any of these can apply to your farm business:
A successful negotiation means everyone feels like a winner. "Nobody's ever going to get exactly what they want in a negotiation," she says. "You don't want to take someone out at the knees where it negatively affects their business, especially in farming."
Ask for what you want. Sounds simple, but in practice it can be daunting. Ask fair but powerful questions. What things in the market do you believe make a fair price for that input? You can't be coy and negotiate well, she says. "You're asking for what you want, but those questions may give you an advantage so that you can learn why they are pricing things the way they are."
Don't take no for an answer. Too often people give up at the first no. Keep going until you get what you want. In business, rejection is never personal; it merely means you did not present a viable argument. The offer is rejected, not you, so keep emotions in check and retune your approach. "No" often reflects a need for more information. Take heart in knowing people say no an average of three times before they say "yes."
Use bid sheets for competitive pricing. "In the government we had to use bid sheets for items over a certain dollar amount; it's the law," she says. "If you open up the negotiation by communicating that you're going to be getting competitive bids from several sources, you'll at least get a fair and reasonable price, and not feel you're being taken advantage of."
Negotiate terms and conditions, not just price. You need to look at delivery time, for example. It's an added aspect to the bid sheet, and it complicates the process. But if it's important to the business, discuss it.
Check out the next five tips in the second installment: 10 Tips for Better Farm Business Negotiations, Part Two