Hints for Contract Negotiation with Prospective Clients

In Entrepreneurship, Small Businessby tmcLeave a Comment

It is not new to find customers/clients wanting to negotiate the price of a product/service from the provider. This is often because, despite the fact that they are in need of your product/service, they also know that you are possibly not the only person/organisation offering that service. So, you, the provider, are now left with a client who needs your service but requires that the terms of the contract be adjusted to fit his/her budget. When faced with such a situation, you should not try to jump at whatever the client wants to offer, neither should you immediately refuse the offer of negotiation. Instead, what you should do is to figure out a way where both you and your client can end up with a win-win situation.

Below are a few hints that will be relevant for you when negotiating with a prospective client.

Prepare thoroughly

When a client says he/she is coming in for a negotiation for a service/product, you shouldn’t wait for the client to arrive first before you start thinking of your answers and running your calculator, because that can leave you out of balance, given the situation, and you might probably end up not benefitting as much from the deal. So, the first thing to do is to prepare for the negotiation. In your preparation, state the non-negotiable; this means areas where you know you cannot bend whatsoever, and the limit to which you can go. This will help you have clarity and stability when you meet your client and negotiation begins.

Don’t be shy to ask questions

A client has come to you to negotiate your terms of service fit within his/her budget. Try to ask certain questions to be clear on what the client actually wants. Asking these questions will help you to know how you can render adequate service to the client, and to critically understand where the client is coming from. So, don’t be shy to ask questions, because you will only be short-changing yourself on the negotiation table.

Show more of value than price

Sometimes, a client might seek a negotiation just to be sure of the kind of value he/she will be getting from you, and not necessarily about the amount. So, it would be wrong of you to keep dwelling on the price rather than showing the kind of value he/she will be getting when they go for your service/product. In this case, preach more about the usefulness and essential qualities that come along with what you are providing. In doing so, you would be shocked that your initial offer wouldn’t be cut-down, because you have been able to prove why he/she should go for your service rather than your competitor.

Stay transparent

Transparency is one of the hallmarks when it comes to negotiation. Clients don’t like dealing with shady providers, because their money is involved in this transaction, so they want to see total transparency in the terms of the contract. Don’t hide anything that they need to know about what they are getting. Full transparency will also give you credit in the mind of the client, and that may just be the winning game for you.

Give smart concession and always have a reason

When your client brings forward his/her terms as against yours, don’t just refute even if it is way below what you can offer. Instead, give a counteroffer and show reasons why his/her offer cannot stand based on the value he/she would be getting from your service. In doing so, this will help the client to fully understand that even if he/she wants the best out of this deal, you also have a business to run.

In conclusion, when going to a negotiation table, try as much as possible to make the environment lax and not tensed, because when it is relaxed, there will be a free flow of conversation, but when it is a tensed atmosphere, things might not go so well as planned. When you follow these hints, both you and your client will most likely leave the negotiation table with smiles on your faces.