The current global crisis we are facing has presented many entrepreneurs with a seemingly never-ending list of urgent negotiations: maybe with a landlord, maybe with a consumer credit agency, or maybe even a mortgage holder. Needless to say that on top of all of this, consumers have been keeping more to themselves.
So, how can you negotiate your way through this crisis so that your business makes it and still comes out the other end in one piece? Take a look at these 6 Secrets To Effective Negotiation in The Midst of Crisis:
It seems that a number of landlords, credit agencies, and others learned from the recession in 2008 that refusing to negotiate with entrepreneurs led to empty homes and storefronts; or alternatively, many painful years spent in court.
Remember that it’s in their interest — and yours, to negotiate; and even more so than ever before. Due to the COVID-19 lockdown and closures, future court dockets are likely to be backed up for many years to come.
Rule number one: don’t panic! Get clear, and ask yourself the right questions:
– Do you want to sign up any clients at any cost, or would you prefer to target a smaller, more long-term customer base whom you’re certain can afford your products or services?
– Are you working to pivot your business and lower rent while you get back on your feet?
– Do you want to get your consumer debt payments down to a specific monthly payment?
When you know the root problem that you’re trying to solve, you can then approach the rest of the negotiation process with clarity and confidence.
What is the one thing that drives every single negotiation? Needs!
Write down your own needs first. This will include both your tangible needs (e.g. 30% rent reduction for x3 months) as well as your intangible needs — things such as financial security, more peace, and emotional stress relief.
Next, think about the needs of the other party too. Just as an example, consider that landlords need to show their own lenders consistent cash flow and strong occupancy numbers throughout a loan lifetime and consistent cash flow. Factors such as this could propel landlords and lenders to ease up on tenants for a short period of time until the market readjusts itself.
Countless entrepreneurs have turned online and to social media in order to network with other people in similar positions to them. Depending on your niche, you can find Facebook groups, for example, where hundreds of thousands of people from around your country — or even globally — trade tips with one another!
This can save you a lot of time, energy, and money (something which I’m sure you need right now) — as it eradicates a lot of the trial-and-error processes you would normally have to go through.
When the actual moment of negotiation rolls around (be it face-to-face or via video call), ensure that you ask very open-ended questions. Trust me, you’ll get much more out of the negotiation if you do so!
Avoid asking questions that only require a “yes” or “no” answer — such as: “Are you able to give me a reduction in rent?” Instead, ask questions that start with “what” or “how.” Here are some good examples:
– “What can we do to ensure you still have cash flowing in, and well as help me stay in business, so we can partner up in the long-term?”
– “What do you need me to show in order for you to feel comfortable with an agreed upon payment plan?”
– “What other agreements have you come to with some of your other tenants?”
When making your requests, angle them from an “I ask…” or “We ask…” kind of standpoint.
Something like: “This is what I am requesting, and here’s how we can both benefit from it.”
Once you’ve taken the time to ask the other party what they need — as well as show them how your proposal aims to satisfy that need — you’re heading towards a far better outcome; one that’ll help you put you back on the road to success!
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