In this article, we'll look at preparing for and conducting negotiations with partners, investors, and clients, taking into account the various tactics applicable to each situation. However, there are a few constants that should always be considered: impeccable appearance, politeness, and professionalism.
Preparing for negotiations
Initial preparation for negotiations involves defining the goal you want to achieve, whether it's closing a deal, a new contract, raising funds, or a partnership agreement. It's important to stick to this goal throughout the negotiations, even if minor concessions may be necessary.
It's also recommended to prepare several possible negotiation scenarios, taking into account the other party's potential behavior, which also has its own goals. Pre-rehearsal will help you prepare for various scenarios and avoid unexpected situations.
One important aspect is your appearance. The more important the negotiations, the more impeccable your appearance should be. For men, a business suit or classic jeans and a shirt are recommended, while for women, it's advisable to choose moderate and subtle makeup, avoiding excessive accents. It's also important to pay attention to your shoes and hands, ensuring they look well-groomed.
Don't forget to bring the necessary supplies: a diary and pen for notes, business cards and brochures to introduce your company, a laptop presentation to showcase your ideas, a bottle of water to quench your thirst, and contract forms just in case. However, please turn off your cell phone to avoid distractions.
Additional tip: If possible, try to arrange a meeting on your own turf, such as at your online store's office, as this will help you feel more confident. If your interlocutor insists on a neutral location, such as a café, choose a place you're familiar with. If you have to negotiate on someone else's turf, be prepared and prepare more thoroughly.
Mastery of words is the key skill of our era.
A key skill of the era, as can be seen from philosophical reflections and historical examples, is the mastery of words. Words play an incredibly important role in our lives. They not only serve as a means of communication but are also multifunctional. With words, we express our thoughts, learn, manage, argue, heal, and even conclude deals. The modern world is based on the ability to effectively use words, especially in negotiations and business transactions. Therefore, mastery of words is an essential and key skill in the modern era.
The key skills of an era change in accordance with the needs and development of society. In primitive times, securing food was an important skill, followed by the use of weapons to defend oneself and one's interests. However, with the advent of money as a medium of exchange, management and the use of words became key skills. Today, the world is built on communication and interaction, and the ability to communicate effectively through words has become critical.
Thus, our era is defined by a key skill: the ability to speak. This skill is the foundation of successful interaction, goal achievement, and problem solving in the modern world.
Scenarios
It's also important to recognize that our work is full of scenarios. These can be roughly divided into two categories: success scenarios and failure scenarios. A success scenario might be, for example, the successful completion of a deal, while a failure scenario might be the client's refusal to cooperate. If one scenario fails, an alternative can be considered. It's important to start with more complex scenarios and move on to simpler ones that are guaranteed to work if a complex one fails. Naturally, this requires developing several scenarios, as they are always evolving.
To reduce the number of mistakes, never act on the first idea that comes to mind. A first reaction often leads to a bad outcome. Even taking statistics into account, the likelihood of making a mistake is higher with initial actions. In business, emotions have no place; cold calculation reigns supreme. Many may object, relying on their experience and convictions, but believe me, this is a serious mistake. Experience is temporary, and what worked flawlessly yesterday may not be applicable today. Every situation is unique, and it is always necessary to understand each one. However, if you are lazy and find it easier to stick to the same actions and automate them, then that's your choice, but this approach will not make you an expert in closing deals.
Negotiations with partners
Your partner could be a new supplier, an entrepreneur from a related industry, or an interested party with whom you have decided to start a new project.
Mutual cooperation plays a key role—both partners strive for mutually beneficial cooperation. This means neither party is obligated to the other, and both are on an equal footing. Adherence to the ground rules is essential.
The following principles form the basis of successful negotiations:
- Speak clearly and concisely, avoiding ambiguity. No one wants a potential partner to speak in riddles or obscure phrases. Adhere to this principle in written agreements. While you can include asterisks and fine print in the contract, remember that reputation plays a major role in business.
- Be honest. Tell the truth about your online store, highlight its strengths and weaknesses, and share your plans for the future. Tell them everything except your bank account.
- Ask for clarification. Sometimes the other person may express themselves unclearly or go off-topic. Don't hesitate to ask again and clarify to ensure full understanding.
- Be polite. Regardless of your prospective partner's social status, be respectful. Things can change in business, so remember the saying, "Don't spit in a well—you might need to drink from it."
- Don't always try to gain an advantage. Some advise being brash and insisting on favorable terms, but this will only create a reputation as a rude and unpleasant partner. Rumors can spread quickly in business, and you could find yourself isolated.
- Be careful when working with friends. Experienced entrepreneurs advise being especially careful when collaborating with friends and acquaintances. It's not always easy to say no, and the outcome can be unpredictable. Trust, but verify.
- Take notes. Record the most important points of the negotiations. They can be useful for subsequent review and clarification.
Advice: Don't despair if you can't find a reliable partner the first time. Everyone has their own perspective and business methods. It's important to find someone you agree with—such partners are usually the most successful.
Negotiations with investors
In this situation, your reliance on an investor and their funding presents a completely different context. We've previously covered how to effectively attract an investor for an online store. Now, you need to understand how to negotiate and present yourself effectively:
Avoid self-praise. Investors are serious and experienced people; they negotiate constantly and can easily spot falsehoods. They've heard countless pitches about "the best startup," how "we'll definitely get going soon," and how "we'll conquer the market." At best, such statements are met with ridicule, and at worst, they lead to rejection. You need to genuinely interest a potential investor to secure the funding you desire to grow your business.
Avoid bluffing. If you don't have seed capital, like-minded people, partners, or other investors, be upfront about it. Your strengths may lie elsewhere. Keep in mind that everything you say will be verified, and no investor will invest without thoroughly researching you and your company.
Provide concrete facts. It's important to provide specific data, not promises of "millions in future turnover." State how you plan to achieve a certain turnover in a year: provide calculations and a business plan. Don't talk about "the best suppliers," but provide a list of your suppliers along with contracts, commitments, and guarantees. Don't claim to "work throughout Russia," but list the specific cities you deliver to. Try to provide specific details and facts.
Highlight the advantages of your business. Avoid complaining about difficulties, the lower tax climate, and the superiority of competitors. Investors are well aware of the challenges of running a small business in our country. Focus on the positive aspects: explain how your store is different from others and what you do to operate successfully.
Don't criticize your competitors. You may think of Horns and Hooves as your direct competitor, but to an investor, it's just another company (or perhaps even a potential partner). If you're confident you can knock your competitor out of the market, explain it and provide evidence. If you have competitive advantages, highlight them. Businesspeople are driven by numbers, not emotions. Or, better yet, establish friendly relationships with your competitors, conduct joint marketing campaigns, and share this with the investor.
Avoid servility. Don't try to be obsequious from the start of negotiations and agree with everything the investor says. Even if your interlocutor is much more experienced, maintain a dignified demeanor. Show yourself as a true entrepreneur: answer difficult questions honestly, demonstrate your competence and market knowledge, and maintain loyalty to your competitors.
Advice: Being sincere and telling the truth is much better than exaggerating your achievements and displaying an inflated sense of self-importance. Investors may perceive you as overconfident and inexperienced and may decline funding.
Negotiations with clients
You've been approached by a client interested in purchasing a large quantity of goods, possibly at wholesale prices. Working with them could bring you significant benefits, so it's essential to meet and discuss all the details. It's important to understand that your position in these negotiations is dependent on your own: if the client is large and promising, you shouldn't miss this opportunity. On the other hand, the client has contacted you specifically, indicating their interest. Therefore, a major deal is on the cards, and your success depends entirely on you!
Be polite and adhere to business etiquette so that customers see that your online store offers excellent service and has no reason to worry in the future. You are a modern and knowledgeable manager who is a pleasure to work with.
Be honest in your statements. Don't lie or exaggerate your capabilities, excess profits, or VIP client list if you don't have one. Such claims can be difficult to verify, but if the deception is uncovered, rumors will quickly spread throughout the business community.
Use bluffing tactics sparingly. Even if you're excited about the opportunity to attract a lucrative client, don't show your enthusiasm too openly. Don't tell them there's a line of people waiting outside your office, but let them know they're the only one and that they're important, while also hinting that your business is thriving and there are plenty of clients.
Research your client's needs. Find out what their goals are and why they chose you as their partner. This will help you better understand them and choose the right communication strategy.
Explain your online store's operating principles and corporate culture. For example, mention that you always process returns, even if not required by law, to satisfy customers. Or you could mention branded packaging or gifts with orders. Provide complete information to avoid any surprises during the collaboration.
Tip: Value your large customers, as they can become the backbone of your e-commerce business. Run promotions, sales, and offer discounts to turn occasional customers into regulars. Don't let your competitors steal them!
Conclusion
What to do after an agreement is reached? After negotiations are completed and an agreement (if one has been reached) is reached, what should be done?
Don't rush into signing a contract or starting new projects. Take a short break to reassess. Trust your intuition; it will help you determine whether a business relationship with this partner is worth pursuing. Learn more about them by reaching out to your contacts and getting references. However, don't wait too long, as your partner's interest may cool, or they may change their mind. Two or three days is enough!
Write a letter to your interlocutor thanking them for the meeting, reiterating the main agreements, and expressing your desire to begin working together. Include the figures discussed during the negotiations (investment amounts, quantity of goods, etc.)—this will help clarify mutual understanding. If you don't receive a response, wait a day or two and follow up. If silence persists, it's better to back off than to persist. Sometimes such situations arise, and your interlocutor may simply change their mind.
When starting a partnership, it's important to honor your commitments. You've written down all the details, so refer back to them regularly and stay on track. Keep to your agreements to avoid rumors in the business community and maintain trust.
