Product Tips
How Much Are You Leaving on the Table? Six Negotiating Tips to Get Better DealsBy: Sandi Smith, CPA
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Situation
Many practitioners feel at a disadvantage in business negotiations and that they don't have it in them to negotiate successfully. But that's not really the case.
Response
You might not have thought about it, but you are constantly negotiating. You negotiate with your spouse on where to go for dinner. You negotiate with employees on what tasks are important for the day and what they will be paid. You negotiate with clients on the work you will do for them and the price they will pay. You negotiate with your child on when it's bedtime. Our negotiation skills are directly tied to how effective we are in getting what we want in life. Here are six tips to improve your negotiation skills.
1. Use a checklist.
Accountants are used to using checklists in auditing and accounting projects. It's only natural that checklists be used in negotiations. Jim Camp, author of two books on negotiation, Start with No: The Negotiating Tools That the Pros Don't Want You to Use and No: The Only Negotiating Strategy You Need for Work and Home, offers these checklist items in a negotiation:
- Have a very clear mission and purpose for the negotiation. Understand the organization you're working for and where they're trying to go with the negotiation. Don't assume you know; ask to gain clarity.
- Have a clear outline of the problems as you see them. Be able to communicate these to your client.
- Know what you want. For example, if you want the client to produce certain records, to deliver information at a certain time, to be available to sign approvals, and so on, make that a part of your list.
- Know what will happen next. Find out what the next step is in the negotiation process. Find out who will be doing what and when.
2. Shut up and listen!
Often when accountants are presenting a proposal, they might feel like they have to act like a salesperson. They might tend to present the features and benefits of their services without knowing what is important to the potential buyer.
Rather than give a presentation, shut up and listen first! Ask your buyer what is important to them and then keep your mouth shut while they tell you everything you need to know to close the deal.
3. Put yourself in your opponent's shoes.
Find out what the people on the other side of the table want. Forget about what you want just for a moment and try to get into the head of the person you are negotiating with. How do they see the situation? What's important to them? What will make their life easier?
4. Don't try to show people how smart you are.
It seems logical that if you come across as smart to the buyer, then you should clench the deal. But this is one of these interesting paradoxes in life.
Being knowledgeable can backfire on you. Using large vocabulary words, dressing fancier than your buyer, and acting smarter than they are to try to show how worthy you are of the job can actually lower the buyer's trust in you. You have created a distance from them by making yourself so different from them.
You can also end up assuming things about your buyer that may not at all be true. "Your greatest strength in a negotiation is to not know," says Camp, CEO and founder of The Camp Group, a company that provides negotiation training and coaching. "Don't assume anything," Camp says.
5. Don't assume you have to give up anything to make the deal.
I have talked with a lot of accountants that question their pricing. Some give discounts at the beginning, others write off their billing amounts when a client complains, still others charge way too little for the value they are giving clients. According to Camp, this is the wrong approach.
At the very beginning of the negotiation, Camp says to state outright that you are expensive. "I am more expensive than other accountants. Also say, I provide more services than other accountants. I am more diligent. If the client has a problem with that, you should end the negotiation right now."
"Your clients will always pay you more than you ask for. The key is to help the client create the vision of the challenges they want you to fix," says Camp, who has conducted negotiations all over the world.
For example, you help them meet a huge number of obnoxious deadlines. You provide a buffer between them and the IRS. You give them valuable information to increase their profits and reduce their expenses. You give them peace of mind. You give them the ability to focus on the part of the business they love. You might even help them from going bankrupt.
The client needs to understand that "when something goes wrong, and it will, the accountant will earn every penny," says Camp, who has negotiated over $100 billion in deals in his career.
It's the big picture you want your prospects focused on, not your hourly rate.
6. Don't give up so easily.
Don't worry too much if you hear "no" or say "no" yourself during a negotiation. Camp's entire negotiating strategy is built around saying "no." Most negotiators in foreign countries and children already know about the power of "no." In Camp's new book No: The Only Negotiating Strategy You Need for Work and Home (Crown, June 2007), he tells the story of his granddaughter's negotiation with her mom over going to bed:
I watched as three-year-old Lilly said no to her mom 5 times and in the end got exactly what she wanted. Lilly sure wasn't afraid to say no or hear no, she just kept negotiating. Persistence is important to the success of "no." If you're a parent, you know that every child hears "no" as the start of the negotiation, not the end of it.
Getting What You Want
Try these tips in your next negotiation, whether it's negotiating what television channel to watch or a $2 billion corporate merger. You might be pleasantly surprised when you get what you want!
Sandi Smith, CPA, is a freelance writer and professional speaker located in Dallas, Texas. She is a frequent contributor to Intuit® ProConnection®. Her web site is www.sandismith.com.
Last Updated: 06/22/2007
