Negotiating a large-quantity sale requires a little give and take on the part of all parties involved. It is a course of action in which both sides seek to fairly distribute the risk and reward. This process (Step Nine) begins at the conclusion of your presentation when you ask for the order.
In today’s corporate world, professional executives seek a win-win result, setting the stage for mutual profitability and long-term relationships. Both parties negotiate in good faith to get the best deal for their sides, but not at the expense of the other. Your job is to find the best package of product, terms and service that most increases the value for your prospect without sacrificing your needs.
Know your BNO
Good negotiating begins with preparation. Even though you cannot predict every verbal exchange, you can set parameters in advance within which you will deal. Before you enter into any negotiation, make a list of what you will give and take – and what you will not. That list is called your Best Negotiated Outcome (BNO), and it should include:
1. A list of all the outcomes that would be acceptable to you. This list might contain a high price, long delivery time, no customization, no returns and 30-day payment terms.
2. Which of these alternatives would be best for you? You may feel that “no returns” is your most-desirable option.
3. What are you willing to negotiate away in return for that outcome? You may barter for a better discount for a non-returnable purchase.
4. What are not you willing to negotiate away in return for that outcome? If cash flow is a concern you may choose not to extend your payment terms.
5. What is your bottom line? Know when to walk away from the deal. In negotiating terms this is called your BATNA (Best Alternative To a Negotiated Agreement), your line in the sand beyond which you are not willing to make any concessions. Knowing that you can make a better deal elsewhere gives you the confidence to walk away from an unprofitable negotiation.
6. What is your final BNO? An equitable conclusion might be an acceptably lower price, feasible delivery time, a customized cover, no returns and 2/10, Net-30-day payment terms.
Hints for successful negotiations
1. Begin the negotiating stage by asking questions to learn as much as you can about the other side’s interests. Why did they not accept your initial proposal? How far apart are your positions? If close, can you split the difference? For specific negotiating scenarios see my article, Make Your Best Deal for Large-Quantity Orders in the October 2008 issue of the Independent.
2. If a personnel change is made midway through the negotiations process, you may be forced to begin again with the new incumbent. But it may benefit you if your previous contact was favorable to your position and was elevated on the decision-making ladder.
3. Don’t negotiate on price. Favorable economics are necessary but not sufficient parts of the negotiation. If you cave in on your price you may give the impression you are willing to bend on other issues. Instead, bargain with the variables you bring to the table that the customer might value. Offer to train their salespeople, ghostwrite the foreword for the CEO and contribute ideas for cross selling. If you focus on price, they may seek a less expensive alternative elsewhere. Do not be provocative or immovable, but remember that quality is remembered long after price is forgotten.
4. Focus on interests, not issues or positions. Most deals are 50% emotion (positions) and 50% economics (interests). The issue under discussion may be the value of using books in the next marketing campaign. Your prospect may have a position against using books in general. However, the underlying interests are profitability or employee productivity. Discuss how you can address their interests without sacrificing yours.
5. Take notes. People may not remember everything to which they agreed. After each meeting send a summary describing the areas of agreement as well as what needs to be done, and by whom.
6. Do not begin discussing the toughest issues. Instead, solve the easiest problems first.
7. Start high and concede slowly. Children know that if they want a hamster they first ask for a pony. If you have to make the first concession to keep the process alive, concede in small increments and get something in return.
8. Build trust first. Building rapport should have begun in the earlier stages as you proved yourself a consultant, helping them solve their problems. But in the negotiation phase your desire to close a large-quantity sale may overpower your need to be more open minded.
9. Don’t negotiate with a time limit. If your counterpart says, “I only have one hour. Let’s talk.” try to delay the negotiation until later. Self-imposed limits do not allow the relationship to unfold or permit time to discuss creative alternatives.
10. Get buy-in, not just cooperation. A solid agreement proceeds on parallel planes. One represents the economic contract and the other is the underlying social contract. Both parties must be committed to making the promotion work. Engage people as partners by asking questions such as, “What do you think? How might we do that? What else could we do? From your experience, how might we make that happen?” As you negotiate with authority, confidence and empathy you develop a sense of partnership with your prospects.
If you choose not to go through all this, you could employ the premium division of a larger publisher to sell your books for you. There are also sales-promotional agencies and premium rep groups that can sell your books. One such group is the Promotional Bookstore (1320 Toronita Street, York, PA 17402). This company has a network of commissioned salespeople who can personally present your titles to buyers in corporations, associations, schools, government agencies and negotiate the sale for you. You can join this network by contacting Guy Achtzehn at firstname.lastname@example.org.
A successful negotiation is not the end; it’s the beginning. If you concentrate only on closing the deal you may lose sight of the real objectives, i.e., to create long-term relationships, reach the intended goals and get re-orders for your books. Once the negotiation is concluded successfully, perform as you promised and implement the agreement flawlessly. That is the topic of the next – and final – article in this series.
Brian Jud is the author of How to Make Real Money Selling Books and now offers commission-based sales of books to buyers in non-bookstore markets. For more information contact Brian at P. O. Box 715, Avon, CT 06001-0715; (860) 675-1344; Fax (860) 270-0343; email@example.com or www.premiumbookcompany.com twitter.com/bookmarketing