How to Achieve a Win-Win Situation
As a self-employed accountant/bookkeeper you’ll encounter many situations where you must negotiate a favorable outcome for your small business. These may be large or small deals and could occur with suppliers, vendors, clients, and other businesses. In order to be a successful negotiator you must know how to gain a resolution that both parties can benefit from. Achieving a win-win situation. Selling yourself short or taking too much from the negotiating party can be damaging long-term. Here are a few things to remember the next time you find yourself planning a negotiation.
Know what you wantFirst you must know what you want. The majority of contract disputes and falling out of business relationships is because of one party not clearly defining what they want from the situation. Many negotiations fail in the first place because one or both parties did not determine beforehand what their objectives where. It’s difficult to hit the mark when you’re not even sure what your own target is. Don’t be too vague (“a favorable outcome”) and don’t be too rigid (“X amount or nothing”). Negotiation is all about modifying terms so that both parties can feel satisfied with the deal.
Come to the negotiation with different optionsNegotiation requires flexibility. Come to the negotiation with different options in order to illustrate your willingness to achieve a favorable outcome for both of you. Perhaps you’ll be asked to lower your fee in order to get a larger company as a client. Don’t lock yourself into a situation where you’re not getting paid what you’re worth, but recognize that you can agree to a lower fee in the beginning which will increase at a predetermined time. Remember, build within your monthly fees a way you can give a “discount” without you having to work for free.
Leave room to bargainBe sure that you’ve determined a bottom line, or what you must see happen in order to accomplish your purposes, and then aim high. Seasoned negotiators recognize that they must aim high in order to get what they want. Determine your bottom line and pad it. If your initial offer is your bottom line you’ve left no bargaining room. Ask for more than what you expect to get and realize that the party you’re negotiating with is doing the same thing. But there’s a fine line between insulting the party by asking too much and low-balling yourself by asking too little.
Pick a good time to negotiateOften timing is everything. Be sure you’ve scheduled your meeting at a favorable time. If the party you’re negotiating with has a crucial meeting just one hour after yours, ask if you can reschedule a time where you won’t be pressured to end the meeting too quickly. Avoid times that are stressful or emotionally-charged. For example, you don’t want to negotiate a deal if you know the company is experiencing crunch-time and will be unable to truly focus on what you’re proposing.
Get to know the party you’re negotiating withIt’s important to not only know what you want but why you want it. You’ll probably be asked to express your objectives and why they are important to you. It’s equally important that you get the same information from the negotiating party. You should know them and understand their motives and objectives. When you know these things, you’ll be able to work a deal that’s favorable for them while being profitable for you. Don’t be afraid of getting into the details of the deal and numbering for the other party all that they would receive in contracting with you for their accounting services.
Don’t be intimidatedSmall business owners are often intimidated when they first begin negotiating, especially if it’s with a larger business. You must recognize what you bring to the table. If you can’t articulate how you can benefit the party you’re negotiating with, you won’t be able to stand a firm negotiating ground, and chances are you’ll give in too soon. Stand firm and be willing to walk away if the deal promises to impair your business in the end.
Keep emotions in checkNegotiations are by nature emotionally charged. Often there’s a lot to gain or loose in a negotiation, and meetings can become heated. While that’s not necessarily a bad thing, you must keep emotions in check so you don’t loose control. You also don’t want your emotions to hinder your ability to secure a favorable outcome. Keep in mind to take nothing personal. By asking for a lower monthly fee, the company is not saying you aren’t worth it, but perhaps that is what they hope you will do.
Be patientGood negotiations can require a series of meetings, phone calls, and email exchanges, so don’t feel pressured to reach an agreement after just one appointment. And sometimes it’s necessary to take a break and evaluate what has already been presented. Don’t feel pressured to end a negotiation too soon; often that means you’re getting the short end of the stick. Holding firm and allowing the negotiation to carry out a bit will demonstrate just how serious you are.
Don’t give away the house to get the welcoming rug. You came into the negotiation process with no deal… the worst that can happen is that you come out of it with no deal. Keep the perspective that is needed to build your business long term and don’t shortchange yourself if what is currently on the table is unacceptable to your profitability.
Negotiations are sometimes a frightening but necessary part of business. Don’t let the fear paralyze you. As long as you take these steps and follow your instincts, you’ll find yourself securing more and more favorable negotiations. Practice makes perfect and you have to start somewhere. Happy Negotiating!
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