Why Negotiation Matters: Do You Suffer From A Negotiating Problem?

 

“I had a gift for selling and persuasion and teaching others to sell, and I blew it. … I understand now that success in the absence of ethics and integrity, isn’t success. It’s failure. And I was the world’s most successful failure in that regard.”

—Jordan Belfort, The Globe and Mail, U.S. Business [updated May 12, 2018]

I have a pinned message at the top of my blog that reads in part, “…Ethical persuasion and influence strategies for entrepreneurs and small business.”

I take ethics in sales and marketing seriously. It’s the upmost tenant in my consulting business. I’m not interested in figuring out how to scam people when it’s just as easy and just as hard as doing the right thing.

I always do the right thing. And if I don’t know what the right thing is I walk away. And I expect my clients, students and followers to do the same.

I’m saying all this because ethics is very easily lost when it comes to negotiation.

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What is Negotiation?

In the Oxford-English dictionary negotiation is defined as: a discussion aimed at reaching an agreement.

There’s a secondary meaning for negotiate which I love: to find a way over or through a difficult path or obstacle. To me this is the essence of negotiating: finding a way over or through with your negotiating partner.

Negotiation is not selling. It’s a mutually beneficial conversation.

In business a negotiation is a conversation about the details of a transaction that both people want to happen. You may be selling something but you’re not working to persuade a prospect. You’re discussing terms of an agreement.

Another word for negotiate is ‘haggle’. Haggling and negotiating have probably been around longer than selling because negotiating was and is a precursor to a trade.

Two people go in wanting what the other has. There’s no persuading one party that they want or need what the other is selling. They already have a mutually vested interest in the outcome.

In a sale, normally only one person has a vested interest, the seller. The seller wants and needs to sell you her product. You may or may not want or need it.

But in a negotiation both parties come to the table wanting what the other has, they just need to work out the terms of the trade. Or maybe you’ve already agreed on the sale and are now working out the terms.

Say I want to buy a car. The dealer may or may not be firm on the price so you negotiate to find the middle both parties can agree to, along with the other terms of the deal.

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Why Be Ethical?

But negotiating can be ethically challenged. Negotiating is something that can be manipulated and can be used as a form of manipulation.

One party can hide the true nature of the exchange. Maybe a car dealer sells you a lemon knowing full well it’s a lemon.

Or, perhaps one party agrees to certain terms knowing he will never fulfill those terms.

Getting ‘taken’ in a negotiation sucks. The person being taken advantage of can walk away feeling sick to their stomach. Later they may be filled with shame. Inevitably that shame or realization they’ve been taken can and does lead to anger and even rage.

No one likes to be taken advantage of, or hoodwinked. It’s demoralizing.

But the single, most important reason to be ethical is because if you are an entrepreneur I presume you want to stay in business for a long time to come.

If you stay in business long enough your misdeeds and misadventures will catch up to you. Full stop.

So if you’re playing the long game as an entrepreneur leave a legacy of an ethical, honest and trustworthy reputation. Your family will thank you. Your employees and the people who depend on you will thank you.

And equally importantly, your customers, clients and followers will thank you and hold you in high esteem.

So how do you do that?

One way to ensure you are ethical in your negotiations is to have a strategy of negotiating that is based in ethics and fairness.

If you have a plan of action that values fairness to all parties involved you will have a higher chance of ensuring ethical transactions.

In this month’s posts we’re going to explore my specific foundation of strategies that are ethical, fair and produce results.

I know this because I always use this formula and it always ensure that everyone walks away happy. And if we don’t then we renegotiate.

The Biggest Mistake in Negotiating

So I’m going to explore the mistakes people make when they negotiate in a later post. But I need to enlighten you right now on a very important point.

What is the biggest mistake people make in their negotiations?

They don’t decide what they want before they start to negotiate.

They get half way through a negotiation and think to themselves, “Shoot, I didn’t want to sell it for $100, that was my lowest price. Why did I just agree to my lowest price?”

or…

“That’s a tall order he’s asking but I’m so uncomfortable, I need to get out of this so it’s fine. I’ll agree to whatever. “Yes, I’ll ship your widget to Reykjavik for free with a Lifetime Money Back Guarantee! Are we done?”

You either give away the farm or you lose money, all because you didn’t decide beforehand what you wanted, and by definition, what you didn’t want.

If you are going to enter into a negotiation you must first decide that you’re going to negotiate and then you need to decide on your terms, to yourself.

That is why having a set of foundational negotiating strategies is so important. They help you take the process seriously.

You could be selling your couch on LetGo but you still need to use some sort of baseline from which to negotiate so you don’t feel taken advantage of and you don’t mistakenly (or otherwise) take advantage of your negotiating partner.

The Long Game

If you’re an entrepreneur and small business owner your biggest asset is your reputation. You don’t want to get into the habit of selling yourself, your clients or your followers short. Ever. Not even once.

In this revealing interview with Jordan Belfort, he describes the one flaw he considers the movie, The Wolf of Wall Street, to have. In the interview he says it took a long time for him to break down his moral compass and start cheating people and gaming the system.

The movie made it seem that it happened very naturally and quickly. But it was an erosion that happened over a period of several years. He says, “When I have to face young people, I want them to understand how slowly, in incremental steps, you start to lose your ethics. It’s not all at once.”

This is a very important point Jordan is making. Environment is everything. Jordan Belfort was thrust into an environment of, at best, loose moral principles from which Wall St. operates.

That environment basically groomed him into finally throwing in the towel on his own moral convictions, or what little he had going in.

It may have taken years but because he wasn’t playing with an ethical playbook the rules were allowed to shift and eventually erode altogether.

That is why having a set of ethical, foundational strategies is so important before you start any negotiation. Instead of allowing whatever environment you’re in to define your behavior, you consciously create your environment using specific criteria.

Doing that will build ethics into every, single negotiation. You will be setting yourself up for success.

Related Post: The D.E.L.T.A. Sales Process to Obliterate Objection for Your Prospect
Related Post: Do You Make These Mistakes in Seeding Your Sales?
Related Post: This is How You Sell Anything

The Wrap Up

To wrap up there are two important reasons to treat negotiating like hallowed ground:

  1. Reputation
  2. Bottom Line

The most important asset of your business is your reputation. Your reputation is the reputation of yourself, your products and services and your team (your customer service).

If you don’t protect your reputation it will become soiled. A soiled reputation is the kiss of death when you’re trying to build and maintain a strong, successful business.

Who wants to do business with a cheat?

Answer: Nobody.

You’ve heard the phrase, “you’ve gotta protect your bottom line.” What does that mean exactly? It means protecting your profit but how do you do that?

Well, one of the most important ways of doing that is providing quality products and services that people don’t want to return.

Another way of doing that is making sure you’re operating ethically so you don’t get sued again and again.

Doing business you will eventually run into mishaps. You may even get sued for some unforeseen force majeur issue. But this should be the rarest of occurrences.

Shit happens.

But it is your job to make sure it doesn’t happen all the time, some of the time or every now and then. All of those are unacceptable in my opinion.

Who wants to get sued ‘every now and then’?

Don’t let that happen.

Negotiating is one of the oldest, most effective forms of communication and survival in the natural world.

And the impetus is on you to learn how to do it successfully, powerfully and with a set of strategies that provide an ethical foundation from which to bargain and barter.

In the following posts I’ll be teaching you a set of foundational strategies from which to negotiate. We’ll also learn the mistakes to avoid and the principles that make all negotiations successful.

The negotiating strategies we’ll be learning this month can also help you win successful testimonials for your products and services.

Click here to for this FREE PDF Tutorial that teaches you exactly how to negotiate powerful testimonials for your business.

Are you a good negotiator?

What’s the best negotiation you’ve ever had?

Join the Conversation>>

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