The first step is to recognize the importance of negotiating in your life. Some things are not worth your time and energy (i.e. can of beans) but when it counts you better know what your doing (i.e. purchase of land). Imagine yourself buying a car and accepting the first deal the lot offers you. Of course that deal would include the lot making excessive money and you losing the same. Of course they want to make the most money they can. You can negotiate marriage, jobs, pay, purchases and just about anything else you can think of.
There are steps to negotiating that you should recognize and understand. These steps include knowing what you want, knowing your limits, negotiating the cost & terms and closing the deal. Each of these steps requires that you have insight into your needs and what you want. As you progress through the steps you will become more confident in your abilities.
Know What You Want : If you don't know what you want then you are not likely to get it. Let us say that you need a new air conditioning unit for your business. You go to the dealer and he shows you all types of units. You have no idea what size, how much power, what type of service or how much you should pay. Likewise, if you plan on moving your business location in the next 5 years you might be better off with a used model. That dealer will likely sell you something you don't want. Do your homework and know what you need so you don't get taken advantage of.
Know Your Limits : There is a saying that states, “If you can't walk away you aren't negotiating”. You need to know where your limits are in terms of how much you are willing to pay and the terms of the purchase. If the dealer doesn't want to meet your terms on an equitable level you may need to walk away. What is your best, expected and worst scenario?
Negotiating the Cost & Terms : This is the part where they give you a price, you make a counter offer and this process continues until you come to an understanding. Sometimes you can adjust the prices for different terms. For example, you can reduce the service warranty for a better price, you can pick up the product to save on shipping, etc. Always offer them a little less than the initial price or demand more options.
Closing the Deal : Once you and the dealer have come to terms then go ahead and get it in writing. Putting your agreement in writing helps to keep each everyone honest. For example, you might have saved money by picking up the product instead of having them deliver it. However, they didn't tell you it was 3 hours drive away. Likewise, you reduced your service agreement for other concessions but they didn't tell you there would be a $50 fee every time they came out.
