A critical negotiation skill in your purchasing negotiations is how you go about preparing your objectives.
I want to provide you with 3 important points that we cover in our negotiation skills training workshops to think about when you are preparing for your negotiations.
1. What is the absolutely best result for you in this negotiation?
What would a absolutely wonderful transaction (one that you would be very happy to agree to) look like?
We call this your aspiration base - in other words, the level at which you will aspire to close the deal.
You should remember that it is important in your negotiation to always ask for a little more than you expect to receive. This means that you should always have an aspiration base that is higher than your targeted outcome. By asking for a little more than you would like to achieve you enable yourself to make a concession to your counterpart in exchange for a counter concession.
On the upside, you may just get what you regard to be ideal if you ask for it! Don't make the mistake of making decisions on behalf of your counterpart by saying to yourself they will not be happy with that .Take note that I am not proposing that you make extreme requests - extreme requests are highly risky and dependent on the cultural context within which you are negotiating.
2. What is the absolutely minimum acceptable outcome for you in this negotiation?
At what stage will you decide to stop or suspend your negotiation?
If you do not decide on a specific point at which it will no longer be feasible or attractive for you to close a transaction, then you may become susceptible to reaching an agreement that you will not be happy with. This is critical to do as you could easily become emotionally committed to closing a transaction at any cost because you may think that your personal credibility is at stake.
3. What do you think are the aspirations and minimum acceptable deal levels for your counterpart?
It is also critical that you think about the aspirations and minimum acceptable deal levels from your counterparts perspective. This will never be an exact science but through proper planning and research of supporting information you may be able to get a good view of what kind of agreement is the standard in your industry or kind of negotiation.
By considering the aspirations and minimum acceptable agreement levels from your counterparts perspective, you will be able to identify the bargaining range. Being aware of the bargaining range or zone of possible agreement (ZOPA) will help you to see if a deal is possible or not.
Most negotiation training programmes will teach you that the agreement range is defined as the area of overlap between your minimum acceptable deal level and the minimum acceptable deal levels of your counterpart.
Remember that 99 percent of your success in negotiation is dependent on the quality of your planning. You should spend at least as much time preparing for negotiations as you expect to be busy negotiating. If you expect to be in negotiations for an hour, then you should spend at least the same time in preparations.
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