3 Rules of Negotiating Power You Should Know

Let your mind go back to the last sales negotiation you were involved in. When it finally came down to negotiating a deal, after all the PowerPoint slides, all the RFP responses, maybe even the baked goods, who had the upper hand, you or the other side of the table?

Why does power matter?

The advantage in any negotiation belongs to the side that has more power. In sales negotiations, power is a slippery thing. It’s hard to know how much you have, and likewise it’s hard to know how much the other side of the table has. Despite all this, it is a critical part of the process: “whoever has the most power in a negotiation is likely to end up MOST satisfied with the outcome.”

What this all means is that you have to get better at assessing the situation: you have to know how to figure out how much power you have and how much the other side has.

Power management: how it’s done

Salespeople have long known that negotiation is a process of information discovery. During this discovery process, you learn what your sources of power are for this particular negotiation. With that said, there are three rules of negotiation that will help you learn more about your power during a negotiation:

• Rule #1: You Have More Power: Rule #1 of managing power in a sales negotiation is to realize that you ALWAYS have more power on your side than you think you do. Even if you think you don’t have ANY power at the start of a negotiation, then you’re wrong; otherwise why would the other party be negotiating with you?

• Rule #2 – Power is not real: You need to understand that power is not real. It only exists in your mind and that’s why it is what you think it is. If you think you are powerful, then you are. If you don’t think you’re powerful, then you won’t be. Of course, this means that you should always imagine yourself as someone powerful no matter the circumstances. Easy for me to say, hard for you to do.

• Rule #3 – Flows of Power: The level of power with which we begin a sales negotiation is not constant throughout the negotiations. The other party may make verbal mistakes and reveal too much, make too many concessions, or do other things that will increase our power during the negotiation. Likewise, if we are not careful we can give up our power during the negotiation.

what this means to you

These three rules of negotiating power are your ticket to success. At the end of the day, every time we enter a negotiation, we expect to leave satisfied with what we were able to achieve: we didn’t give too much and we got what we needed.

To get this kind of satisfaction, we need to have enough power on our side to allow us to get away with things that count.

Realizing that bargaining power is a state of mind and that we have control over how much we have will allow us to use it to close better deals and close them faster.