How Much Room to Negotiate Should Salespeople Have?

“On the surface, selling and negotiating may appear very similar. They have the same aim-reaching an acceptable business agreement…But there’s a big difference.”

– Neil Packham

So what’s the difference? When you are negotiating you are prepared, if necessary to give something away in order to do business. But when you are selling you don’t give anything away. Your success rests on your ability to persuade the other party to buy the goods or service that you are offering, without discounting.

Contemporary selling is, in essence, about recognising the exchange potential of your target customer, developing a value hypothesis, initiating contact, and asking the right questions so that you can get the right answers. Negotiating, if it becomes necessary, begins late in the sales process and must never be a substitute for communicating a well thought out value proposition and overcoming objections/resistance.

Most sales managers have unpleasant memories of reps who, given the power to offer price concessions, use that as their opening line in the sales conversation with customers. And in the process they give away margins without any increase in volume. A classic case of lose-win, which in many instances means little to a rep who used this as a means to making his sales target.

Which leads to my question: how much latitude to negotiate should you allow your sales reps?

Herman D. Alvaranga is president of the Caribbean School of Sales Management. Connect the dots…and call us instead of looking outside the region for world-class sales and marketing education, consulting and training.

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