Business: Negotiation strategies

Nowadays, we tend to think that negotiation strategies are exclusive for business people or huge corporations, but the truth is that even small entrepreneurs can use these tactics to boost their projects. Learn here how to develop your strategy

For this reason, as a future entrepreneur, it is key to be clear about what negotiation strategies are and how to apply them correctly to achieve the desired results, and to know how to measure the proposed objectives for a certain period of time.

Before start talking about negotiation strategies, it’s important to have a clear understanding of “negotiation”. It is a term that has been employed for ages for many kinds of business.

So, what’s the meaning of negotiation?  

We can understand it as a process between a minimum of two parties with different objectives, necessities, and points of view that try to reach an agreement with the intention of resolving a matter of mutual interest. 

On the other hand, negotiation strategies can be defined as tactics to prepare for future negotiations or business, it requires a previous preparation of what is going to be faced with the other party, and it includes meetings and agreements. Also, a future idea of what is acceptable on our part. 

Managers and entrepreneurs face these situations on a daily basis. However, we can see the negotiation context in almost any area of our daily life. Real examples are found in the purchase of a vehicle, employment contracts, or even divorce agreements. ¿Do you see the necessity of preparing a negotiation strategy after?

Regarding the most common type of negotiation at the business level, we can see it in the purchase of products and services, labor disputes, and many other situations in our daily life. 

The reality is that negotiation strategies will always be the first step to avoiding conflicts that could put the business project at risk. Therefore, the goal of the negotiation strategy is to minimize the risks and imbalances between the parties involved.

After having a general idea of the concept of negotiation, and negotiation strategies, it is important to mention the types of negotiation. 

Every party can choose what type of negotiation will use; it mostly depends on the results to be achieved. The strategy to choose will also depend on who is negotiating, the relationship between the parties, the time frame, and the environment of the negotiation process. 

Collaboration or cooperation in business strategy.

It is the most difficult to achieve since the tendency is that both parties to agree to a final decision. It is important to understand and analyze the needs of all parties. The objective is that the arguments of others are supported and are intended to obtain the best solution. 

But it is not just about understanding interests, but also the rest of the elements of the negotiation that are part of the planning, such as the generation of solution options, creating alternatives, supporting the argumentation, the communication, and the relationship between both parties. 

It is not easy to negotiate collaboratively, but this strategy has a high probability of reaching the best agreement, with incentives for both parties. However, it requires creativity, ingenuity, emotional stability, and coordination on both sides to recognize opportunities and get what they want from the other. 

Competitive business strategy.

This strategy focuses on winning above all else and imposing their will, the competitive strategy aims to obtain an immediate benefit at the cost of beating the competition and taking away their profits. The purpose is merely economic and only a final result matters, so interpersonal relationships and dialogues are left aside. 

Competitive examples can be found in companies that analyze the competition and improve these services, offering customers renewed and original solutions.  Adaptability plays an important role here, after an analysis of a product the companies can adapt their product to fit it in the market. 

Companies like McDonald’s, KFC, and Starbucks are just some examples, these companies usually adapt their products to fit in a certain market and maximize their profits. 

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Transfer strategy.

This strategy is known as; I lose today to win tomorrow. It means the satisfaction of only one of the parties, with the expectation of getting any benefit in further negotiations. 

Evasion strategy.

After an analysis of the situation to be resolved, the parties understand that time and money would be wasted in a basic conflict in which the benefits are unknown and in which resources are scarce.

Transaction strategy.

It is an intelligent and useful tactic in contexts in which the parties do not want complications with the issue that is being dealt with in negotiation. Both parties cooperate to obtain mutual objectives and easily get an agreement. The base of this strategy is to discuss the benefits while assuming the least possible risk. 

It is important to keep in mind that using the right negotiation strategy is not the only element needed to be successful in a negotiation. Some aspects like building rapport, the right language, and even some protocols are important when negotiating.