The 9 Fundamental Rules of Sales Negotiation

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Max Altschuler




There are tons of steps and actions that go into closing a deal. So while I congratulate you on getting to the point where you can close, the reality is you’re just getting started.

John Barrows, a leading sales trainer for some of the top B2B SaaS companies, has spent ample time thinking about the best approaches to close a deal. Today I bring you his nine rules of sales negotiation and tips on how to create equality in negotiations, in his own words.

In my view, there are nine rules of negotiating a sales deal:

1) The Rule of Reciprocity

People have a natural inclination to repay debts.

2) Conditioning

Nothing comes for free. Make sure to give and get.

3) Know What to Ask For

And when to ask for it.

4) Follow Good Pre- and Post-Conversation Protocol 

Nail down a time prior to the negotiation, and make sure all decision makers are able to join. Send a summary of the conversation afterwards.

5) Measure the Health of Your Accounts

Stay aware of the health of your accounts so you know which ones need nurturing, and which are ready to close.

6) Time Management

Know which accounts to focus on first.

7) Common Language

Make sure to speak in terms your prospect understands.

8) Story Time

Know what stories to share, and when they are appropriate.

9) Know When to Walk Away

Recognize when a deal has died and don't be afraid to walk away.

True negotiations are about coming to a mutual agreement where both parties feel they got something out of the deal. Contrary to popular belief, you don’t “win” a negotiation by making the other person lose. Both parties need to give and get along the way. The more equal those gives and gets are, the healthier the relationship.

The problem is that salespeople tend to be “givers.” We give and give and give and expect one very large thing in the end as our “get” (i.e., the signed contract). We think we’ve earned it because we did everything the prospect asked for.

However, if we give throughout the process without getting much in return, we condition the client to treat us like a doormat. They end up having virtually no respect for us, which is why they either ask for freebies or discounts towards the end, or they just flat out disappear and don’t even give us the courtesy of a call

For these rules of negotiation to work, salespeople need to find a way to create and condition equality from the start of the relationship.

How to Create Equality in Sales Negotiations

Most negotiations use a quid pro quo approach to create equality -- getting things in return for what you’re giving away. This is sometimes necessary but tends to create contentious relationships in the long run.

There is something else that can be even more powerful to leverage -- a human condition called the Rule of Reciprocity. This rule holds that we are all bound -- even driven -- to repay debts. We don’t like owing anyone anything.

If someone asks us for something, the receiver actually feels obligated to give him or her something in return. The sooner we ask for something in return, the easier it is for us to get. By understanding all the gives and gets along the way and matching them up, we know exactly what to ask for and when to ask for it to move the deal through the pipeline  … or to get out before it’s too late.

Would you add any rules to this list? Share in the comments.

Editor's note: This is an excerpt from the new book Hacking Sales: The Playbook for Building a High Velocity Sales Machine. It is published here with permission.

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