The Audible-Ready Sales Podcast
The Audible-Ready Sales Podcast

Episode 48 · 1 year ago

How To Negotiate Early w/ Tim Caito

ABOUT THIS EPISODE

While you’re working your current deals, there are key steps you should take to start the negotiation process early and drive better outcomes for you and your buyers.

In this episode, Senior Partner Tim Caito shares how you can set yourself up for success before price conversations begin — and in the end, close for a premium. Tim’s perspective is helpful for anyone who wants to improve their negotiation process and put a stop to closing for a discount. Share with your teams to ensure they’re using these three concepts in their sales conversations in order to start the negotiation process early.

Check out this and other episodes of The Audible-Ready Podcast at Apple Podcasts, Spotify, or our website.

Here are some additional resources on negotiating early

- Negotiation FAQs & Best Practices

http://apple.co/369t4OH

- Finding Success with Procurement Podcast

http://apple.co/38WH4wR

- Changing Your Conversation with Procurement On-demand Webinar

http://bit.ly/3nN97V4

Once you create that frame of reference. All, what what happened if we fail to reach your room? And now let's come a hundred eighty degrees around and talk about the next thing, which is considering the and expanding the list of items that need to be included for both sides to secure a great outcome. You're listening to the audible ready podcast, the show that helps you and your team's sell more faster. Will feat your sales leader sharing their best insights on how to create a sales engine that helps you fuel repeatable revenue growth, presented by the team at force management, a leader in BTB sales effectiveness. Let's get started. Hello and welcome to the audible ready podcast. I'm Rachel Clap Miller, joined today by Tim Kato. High Tim, hello, Rachel and everyone. Yes, so we're at the start of another quarter, another year. Those of you listening, you've got deals in your pipeline, I know it, and while you're qualifying them forward, you also need to be...

...starting the negotiating process. So Tim's joining us today talk through ways you can begin the negotiation process early. What a concept, Rachel. Think about the end from the beginning. Now you know many selling organizations tend to progress their deals one tactical step at a time a while. That's understandable. It's actually a common practice that's fraught with big time missed opportunity, Opportunity that we most often which we had taken advantage of when it's time to close that deal later, right, we're in those final stages, are looking back in like, Oh, if I had only done necessary, how easier. Right. Many of us probably had that feeling at the end of the year last year. So those of you who are out there listening, if you've had our negotiation training, our value negotiation training, we know you have the tools in place to do this. Do this and you're probably doing it right now. But if you haven't, we're going to walk through some things you can do to ensure you are doing the best you can to set yourself up for for success...

...in those later stages of the deal so you're not looking back and saying, Oh, if only would it, could have shout it right. So let's start him with those components that we want to make sure are in place early. Okay, Rachel, let's talk about three big considerations for starting the negotiation process early. Alternatives great outcomes and anchors. So first let's start with somewhat illogical question. What happens the both sides if we fail to reach an agreement? You know, the impact of life with the most likely alternative to a negotiate agreement is actually a very important frame er reference for both sides to analyze and fully understand early if we really want to create more value, and this is a very difficult framewor reference to try and set at the end, people will want to go back and look at this at the end. They're much more likely willing to consider, cider it and maybe even talk about it at...

...the beginning. Yeah, that play right there. Those are those negative consequences that people have had came in the message or trying to define as negative consequences related to the negative required capabilities if they don't reach an agreement. What bad things are going to happen? Right, that is exactly right. It is important for us to consider it too, because if we really want to create value, we have to create more value than what they would get from they're most likely alternative. So it's not only negative consequences, is also positive business outcomes. Are Good things that would happen? Yeah, well, so let's shift to that, right HMM. The second thing you want to consider, once you create that frame of reference, all, what what happened if we fail to reach agreement? Now let's come a hundred and eighty degrees around and talk about the next thing, which is considering the and expanding the list of items that need to be included for both sides to secure a great outcome. You know what must be included in the deal for both sides to really create...

...value, and I put the emphasis on their really create value, not a little value, big value. And in particularly here, Rachel, we need to ensure that the view of a great outcome reflects all the varied interests across the customers organization, not just one group or one person's position. This is one of the primary reasons starting the negotiation process early is so critical. Think about it. Who exactly is the customer when you're selling a complex solution? Odds are the customer is actually a collection of people spread across a whole lot of functions that, honestly, might not all agree on that definition of a great outcome. Oh and, by the way, reach Ol, we have that exact same collection of varied interests on our side. To. So waiting to the end to secure and negotiating what we refer to here at force management...

...as the collective. Yes, is one of the biggest ways value gets limited in the negotiated agreements between selling organizations and customers. We used don't take enough interest into an account, into account when we're trying to shape these deals. Now here comes the third part. So we've talked about alternatives, we talked about great outcomes. Now I want to talk about that third component, Rachel, anchors. We put all of this into play through the skill of early stage anchoring. It's a phrase I wanted to fine here. You know, anchorings the tactical side of the sales negotiation process, and we got to focus on that from the very beginning. In other words, start by firmly embedding into the conversation a full understanding the impact of both sides, alternatives that we fail to reach agreement and a broad set of interest that must be addressed for both sides to secure a great outcome. Now you know, those are the...

...three big pieces there, Rachel, and there's still the idea of potentially value limiting tactics we got to deal with, but that's a different topic. Right. I mean we could. We could do a whole couple hours on this the day's right Tim but we'll stick to this big three. Say those others for a separate podcast. Let's go back to that idea of early stage anchoring that you mentioned. That kind of goes into this idea of give gets at something else. You want to make sure that you're thinking through early in the early stages of a deal. Boys. So true, Rachel. So, in addition or early stage anchoring, a core part of our overall negotiation strategy is to map out our gifts and gets warely in the negotiation process. Think of it this way. Rather than conceding our way to an agreement with the customer at the end, the best way to create capture more value for both sides is to trade our way to an agreement, and this is where our...

...give gets strategy comes into play, securing internal approvals and alignment on the gets that we want to target in the negotiation, as well as the gives that were willing to exchange for those gids. Creating and executing that give gets strategy is where the internal negotiation process within our own company informs the external negotiation process with the customer, you know, and that's a big thing for us to think about, Rachel, and when we start it late, we just put ourselves behind the current and potentially slow our own deal down. So the best negotiating organizations in the world plan and execute both their early stage anchoring and give get strategies from the very beginning. Yeah, and, as you mentioned earlier, ten, you need to be talking to more than just your main contact or that economic buyer when it comes to negotiating. We've had done a podcast...

...before about procurement and we know we often talk on this podcast of broadening out your sales organizations to multiple players in the organization. But here specifically, what are your best tips for broading out, broadening out that negotiation conversation earlier, which is probably one in the same of the value conversation? Right there, you go, there you go. Up to this point, Rachel, we've talked a lot about the what that gets negotiated, the broader view of the what was to our attention for a minute, to the WHO, and I know you're going to be surprised to hear me say I think there's two questions we need to ask ourselves here when we broaden the conversation. Who are we broadening the conversation with? Well, you know, the first question is who is directly involved with making this decision. Obviously we need to be talking to those that have a formal role in the customers decision process, by the way, Rachel, including procurement, if they're involved, they've got a formal role.

We need to be having conversations with them about alternatives. Great outcomes are early stage anchor strategy. But the second question on the WHO to negotiate with to expand that conversation, and this is an important often overlooked peace right. Who will be impacted by the decision? Not just those involved in making the decision. Who will be impacted by the decision? You know, those in the organization that have influence relative to the business issue that their organization is trying to address. That likely, if they were asked, would have a strong opinion about what item should be included in the final agreement. But they don't often even know that a decision that will impact them is about to be made. So you know, from our perspective, all those people have a vote in securing the collective yes, and you know not to make a pun on...

...what we just went through a few months ago. It's our job to get out the vote, especially when our differentiation aligns favorably with that broader audiences definition of a great outcome. Yeah, it's about kind of owning that process and when you're owning that process you can better impact, especially if you're owning it early, like like you've said, Tim. Yeah, it's tough to get to more people at the end, Rachel, but it's a lot better and you're actually doing what we all say we want to do, create value for the customer. We still have to recognize they usually, on their side, have many different definitions of value and we're trying to help them pull that together. Yeah, and so those of you who are listening, if you've had value negotiation, like I said at the beginning, these should serve as good reminders. But if you haven't, you can still do this process as yourself as somebody who is trying to work the deal. Broaden out your sales conversations.

All of these tips ten is walking through today should help you get to that information early. So, as we wrap up, Tim, I love to hear you wrap this up with with a bottom line. Yeah, bottom line right to first of all you know, there's a lot of nu once to executing what we're talking about here, but the bottom line is that the best sales negotiators in the world always start early. They create an early stage anchoring strategy. They map out their give get strategy from the very beginning and from the beginning they focus on influencing the definition of a great outcome across everyone required on the customer side to achieve that collective yes, yeah, thank you, Tim. Really appreciate you breaking this down with us today. I know that you know sometimes we kind of give a quick brushstroke to these complex topics and these topics can get complex when when you're trying to close a complicated deal.

But hopefully you you listening out there. I have found some value in this podcast. We've also recorded several with Tim about negotiation. We mentioned that for curement. We have all of our value negotiation resources, including all the PODCAST, linked up on a value negotiation resource page on our website. I will link that in the show notes, so be sure to check that out. There's some great tips there. Until I know you've been a great help in developing a lot of that content. Not of good stuff in there. Rachel so this is just one more version of that old sales wisdom. Start with the end of mine. There you go, all right. Thank you, Tim. Appreciate it. All right. Thank you to all of you for listening to the audible ready podcast. At force management we're focused on transforming sales organizations into elite teams. Are Proven methodologies deliver programs that build company alignment and fuel repeatable revenue growth. Give your teams the ability to execute the growth...

...strategy at the point of sale. Our strength is our experience. The proof is in our results. Let's get started. Visit US at force MANAGEMENTCOM. You've been listening to the audible ready podcast. To not miss an episode, subscribe to the show in your favorite podcast player. Until next time,.

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