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Outline of the Core Steps in the Negotiation Process

written by: DanaGriffin•edited by: Linda Richter•updated: 6/21/2010

Negotiation skills help the small businessman maintain relationships while getting what she needs to succeed. Review the basic outline of the core steps in the negotiation process and carry out successful discussions with clients, vendors, family, and even neighbors. Both sides can come out winners!

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    Overview

    Puzzle by Salvatore Vuono on FreeDigitalPhotos.net When you own a home-based business, you negotiate with customers or clients, suppliers, creditors, family members, and even your neighbors. Whether you are negotiating quiet time with your family so that you can complete work, shared street-parking arrangements with your neighbor, or a work-trade agreement with a supplier, you need to work through some core steps to succeed. The five sections below will take you through an outline of the core steps in the negotiation process.

    Image Credit: FreeDigitalPhotos.net, Puzzle by Salvatore Vuono

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    One: Creating a Win-Win Situation

    While there are long lists of negotiation tactics, training, and preparation, for the small business owner there are five key steps in any negotiation process. We’ll begin with the end: The result should be a win-win for both parties. Small business owners need relationships with all of their working partnerships, even neighbors. Creating a win-win scenario means that you consider more than your own bottom line. So, start by putting yourself in their shoes to figure out their needs and interests. Generate a list of possible solutions that benefit them. Then, determine what you can do to give them what they need, while you get what you want. If a fellow business owner wants you to create a logo but doesn't want to pay your price, negotiate with him to give you something in return.

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    Two: Cooperation, Not Competition

    When you are negotiating, you are not trying to best the other party. The idea is not to bully them into submission with hard negotiating tactics. You want them on your side now and on your side in the future. One way to approach them is to use the classic “feel, felt, found" method. Overcome their objections by empathizing: “I know how you feel..." “I’ve felt the same way..." and “here’s what I’ve found." Your unstated goal is to improve relationships with the other party, not damage them. So when your son feels like all you do is work, negotiate some concentrated work time by letting him know you feel the same way, but you've found that if you can get it done now, you can play...with him...longer.

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    Three: Define the Problem

    Before you can negotiate, you need to decide what the actual problem is. More importantly, you need to recognize that the person is separate from the problem. When you attack the problem, you can find solutions. When you attack the person, there is no solution. If you need extra parking space one day a week when your team meets, the problem is parking space, not that your neighbor is thoughtless by taking up two spaces with his car. Defining the problem takes more effort up front on your part than yelling at your neighbor about his car. Setting your ego aside is hard work, but it helps you focus on finding a solution to the problem.

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    Four: Quantify the Solution

    Your final solution needs to be objective. Both parties should be able to measure whether it is working for them. If one party feels taken advantage of, the solution will fall apart. As you discuss the potential solutions, watch the person's body language and facial expressions to see if she is really on board. Remember that many people are non-confrontational, so they may tell you what you want to hear, but ultimately they will resent the outcome. Careful observation on your part and requesting plenty of feedback will help avoid that pitfall. That client who wants you in her office the whole time you work on her project needs to see that her bottom line improves if you can telecommute instead.

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    Five: Preparation

    Finally, don’t go into negotiations unprepared. If you only have one solution to offer, you’ll end up back where you started, so take the time to consider all the options. In our parking scenario, consider trading something for the parking space, or changing the day to a time when your neighbor doesn’t need street parking. The more options you have available, the more likely you’ll find a negotiable solution.