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Retail Buying

Notes mandate is to hammer the salesperson into submission, in conclusion succumbing to a
rock-bottom price. Classic tactic of a C account. How to negotiate against price and discount
pressure is a common challenge among sales professionals. You’ve probably heard it before,
“Your price is too high. You’ll just have to do better,” or “It’s a competitive market. Your
competitors can beat that price,” or “You’ll have to show more elasticity on your discounting,”
and so it goes. When salespeople concede too quickly in these situations they not only reduce
profitability, but also devalue their customers’ perceptions of the product or service. Don’t
respond by asking, “What’s the price they’re offering you?” or “What price do I have to beat?”
This is a common mistake because it shifts the focus to pure price and discount levels. Experienced
negotiators transfer the focus to value comparisons versus price comparisons.
Acknowledge the customer’s curiosity about price, but don’t get sucked into a price debate prior
to preliminary confirmation.

Example: When you ask for their business using magic words, your customers may
inquire about your price. Simply say, “Yes, I’m sure we both recognize that price is important,
but at this point can we agree to do business together based on the benefits discussed, as long as
I can give you a competitive price?” If the customer says yes to your initial confirmation, you
now have a willing party with whom to negotiate.
Consider the preliminary confirmation as a conditional sale; conditional upon working out
terms and conditions supported by a competitive price. What salespeople need to realize is that
if a fair price cannot be worked out then there is no deal. Final confirmation is conditional upon
victorious negotiation. However, don’t negotiate all aspects of the deal and then focus separately
on price. Make sure price or discount is part of the whole package, not a divide negotiation.

Negotiate the Issues, not the Personalities

Often, what causes you to become frustrated or annoyed in a negotiation is not the topic or issue,
but your customer’s personality traits. By putting emotional distance between yourself and the
negotiation you gain a tremendous advantage? Negotiations frequently unleash emotions that
short-circuit rational processes. We sometimes abandon our carefully designed strategy and
resort to a flight or fight response. The key to effective, win-win negotiation is to act in response
unemotionally.

From time to time you may find yourself commerce with an individual you do not particularly
care for. Chances are you wouldn’t invite him to go camping with you, but he may represent an
A account and a sizeable business opportunity. Experienced negotiators understand that
professionalism requires the ability to distance oneself from any emotional distractions. These
may include biases, perceptions, values, fear of being subjugated, egos, feelings, moods, stress,
and so on. Parties can get too caught up in the emotions of negotiation. They become too close
to the deal and overlook important facts that may help move the deal forward. In spite of all
your efforts to build a personal relationship you may find yourself commerce with just a corporate
relationship. You can both still benefits by simply doing business together and nothing else.
Don’t entangle relationship challenges within the negotiating process.
For most salespeople, the major barrier is simply the fear of negotiation. The very thought
sends paralyzing shivers up their spines. The toughest hurdle is learning to be confident enough
to stand up to the challenge. This means developing the ability to comfortably express a position
without hurting anyone or being hurt. Many people find the straightforward, aggressive, business
dialogue of negotiation intimidating. It’s the same challenge with confirming: the fear of rejection
or perhaps sounding too aggressive. Our natural human tendencies prevail—in our adolescent
years we were taught that it was polite not to ask for things and never to be confrontational.

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