10 Things to Know About: Effective Business Negotiations

Negotiations are an almost-daily work activity for Gene Cody, President of the Montgomery-based commercial realty business Moore Company Realty, as he makes deals for his clients.

But according to Cody, we all negotiate every day. “Negotiating is a fundamental form of communication,” he said. Take note of Cody’s top 10 tips for conducting effective business negotiations. 

1. Know Your Audience

The more you know about your audience, the more you will be able to engage them and understand their needs and wants on a more personal level — such as their motivations, lifestyles and behaviors. These efforts will pay dividends later when you begin preparing for your negotiations.

2. Be Prepared

A successful or unsuccessful negotiation lies all too often in the quality of the parties’ preparation. Take plenty of time to analyze what you want out of the negotiation. Proper preparation is an important source of negotiating power.

3. Understand Your Market

Understanding the market is another important essential in negotiating. Conduct thorough research before entering into a negotiation so you’re armed with a solid understanding of the current market conditions, trends and values in question.

4. Control Your Emotions

Emotions can be contagious, and it’s important to not let yourself be affected by others. Be mindful and aware of everything going on in the room, from body language and facial expressions to word choice.

“Negotiation skills are life skills; you must develop these abilities to be successful in both business and life.” 

5. Ask Questions

Ask meaningful questions, then listen to the answers. By asking questions you uncover needs and priorities; the sooner you can find out what the other party wants and why they want it, the sooner you can come to conclusions.

6. Listen

This may seem like a repeat, but listening is so critical. It can be very difficult to listen when the other party disagrees with you. It takes time and practice to be a good listener. 

7. Use Your Sense of Humor

Negotiations don’t have to always be tense conversations. Enjoy the time spent with the other party; you might need them one day

“Bridging the gap between two parties can be challenging but also rewarding when everyone arrives at a mutually beneficial outcome.”

8. Be Appreciative but Firm

Thanking someone for their offer or job well done not only makes it easier to negotiate with that person later on, but it is also likely to improve cooperation. You have to think creatively to ensure that each person involved in a negotiation walks away from the deal happy.

9. Don’t Draw Hard Lines

Negotiations are a game of give and take. One must be willing to give something up in order to get something in return. Refrain from saying “no” too early. You’ve always got it in case you need it.

10. Be Willing to Walk Away

Each party in a negotiation should have a desired outcome and a worst-case scenario. In a sales negotiation, the seller’s asking price is their desired outcome, but they should also know the lowest price they’ll accept to still do the deal in the worst case. To be a skilled negotiator, you must have a “walk-away” plan.