Why Negotiating In Sales Kills More Deals Than It Saves

10 min read
Jun 26, 2022

Negotiating in sales is like paying your taxes: it feels guaranteed to happen.

Not only does it feel guaranteed to happen, but most salespeople assume negotiating helps increase their win rates, build trust with prospects, and even help foster better customer relationships!

However, the truth is that negotiating with prospects does not help you in the least bit.

Instead, the hard truth is that negotiating in sales sets you up to lose:

  • Time and money
  • Customer respect
  • Potentially the deal altogether

To prove it, I’m sharing why negotiating in sales will not help you win deals as you think.

More importantly, I’m sharing how to prevent negotiations. 

As a result, you close more deals than ever without having to make another concession again!

 

What Most People Tell You About Sales Negotiation Strategy

 

Most salespeople believe negotiation is a normal part of the potential customer decision-making process.  

As a result, they think they know a thing or two about negotiation tactics.

However, if the things most salespeople believed about negotiation were true, then there would be many more successful salespeople out there!

More specifically, there would be fewer salespeople who either took a loss or lost the prospect altogether due to negotiating.

Moreover, if the things most people told you about negotiation were true, there would be many more successful salespeople!

Here is what most salespeople incorrectly believe to be true about negotiation.

 

Create a Sales Negotiation Process

Most salespeople tell you to develop a sales negotiation process because negotiation is almost inevitable.  AKA, expect the worst to happen!

More than that, many people will tell you to create a negotiation template.

That way, you walk into every negotiation and repeat your negotiation process again.

They tell you that it’s better to arm yourself with the correct negotiation techniques than to walk in totally unprepared.

Moreover, prepare for the worst by having a process!

 

Take Objections as They Come

Most salespeople tell you that it is normal to get hit with objections.  AKA, it is okay for prospects to object to your pricing, strategy, or something else as if they know what is best.

Then for the sake of customer satisfaction, you must be prepared to make price concessions.

The customer is always right, true?

People will tell you it is better to walk in ready to make a potential price discount than it is to lose the prospect altogether.

The last thing you want to do is lose the prospect because you aren't making a win-win concession, true?

 

Take Sales Negotiation Training to Learn Sales Negotiation Skills

Even more, salespeople will tell you it is best to arm yourself with the right sales negotiation skills, such as understanding the correct body language and collaboration tactics.

According to most salespeople, sales negotiation training courses teach the essential skills.

Traditional training programs supposedly tell you everything you need to know to manage customer negotiations.

 

Negotiation Is Normal and Okay!

Finally, the last negotiation tip most salespeople will give you is to be chill about negotiation because it is a normal part of the sales process!

If you want to close deals and foster an effective customer relationship, you must be willing to make concessions when necessary.

Bottom line: Do not sweat negation because it is a normal part of selling that most salespeople experience!  

AKA, because everybody experiences it, it is okay for you to go through it, too (even though it makes you miserable)!

 

What Are the Rules of Negotiation?

 

The first and only rule of negotiating in sales is do not negotiate!

The deal is set in stone once you set your price and terms of the agreement.

However, that is only true if your price and terms are fair.

Yes, all prices are technically made-up, but you know what is fair and realistic for your customers!

That said, the only rule of negotiating to keep in mind is not to do it.

 

Only Negotiate Under This Circumstance

Alright, so there is one circumstance you can negotiate.

If your prospect cannot afford your price tag, ask yourself if you are willing to accept a non-monetary item in exchange for a discount.

For example, if you are looking for customers to be subjects of upcoming case studies, exchange a discount for their participation in the case study.  

If the non-monetary item will make up the value lost in price, then go for it!

 

Do Not Negotiate But Do Be Flexible.

Just because you should not negotiate does not mean you cannot be flexible with prospects.

For example, offer a flexible payment plan if you know your prospect will struggle to meet your price expectations.

As a result, you will take some of the immediate blow off the potential customer's plate while ensuring you still get what you deserve.

Be flexible without cutting yourself short!

 

How do salespeople negotiate prices?

 

Why Negotiating With Prospects Is a Set-Up for Disaster

 

You are an absolute expert in your field.

Your product or service fills a particular void in your customer’s life that, if not filled, puts achieving their business goals in jeopardy.

On the other hand, your customers are not experts in YOUR field!

If they were, they would have already filled the void preventing them from reaching their business goals.

Unless you act as the expert, the prospect will not get the solution they need because they do not know what they need in the first place!

That said, negotiating with prospects makes the prospect the expert instead of YOU.

Would somebody who is an expert at what they do be willing to negotiate the value of their product or service?  

Of course not.

Therefore, if you negotiate with prospects, they will not perceive you as an expert. 

Because they do not see you as an expert, they are less likely to purchase your product or service.  As a result, they cannot fill the void preventing them from achieving their business goals.

Hence, why negotiating is a recipe for disaster!

 

Customers Will Not Respect You If You Negotiate!

Imagine visiting a supposedly expert orthopedic surgeon because you struggle with back pain.

After the surgeon examines your scans, they tell you that you must undergo particularly challenging back surgery to live a healthy life.

Once the surgeon explains the surgery, they lay the price tag on the table.

Suddenly, you start to feel a little nauseous. 

Despite having medical insurance, the price tag makes your stomach crawl.

Meanwhile, the doctor sees that you are feeling anxious about the price; to make you feel better, they decide to reduce the cost of the surgery.

Would this make you feel more or less confident in the surgeon's supposedly expert abilities?

If you are like most people, you would not expect an expert surgeon to budge on price because they are, well, an expert!

Not only do you not expect it, but you start to doubt the surgeon because they are willing to negotiate with you.

That said, the moment you start to negotiate is the moment prospects see you as less of an expert.  As a result, they lose respect for you and your abilities.

Do you think a prospect is more or less likely to buy from you if they do not respect you?

 

When You Negotiate, the Customer Becomes the Expert

By default, there is always an expert in every sales scenario.

If you do not step up as the expert in the situation, the prospect becomes the expert by default, and nothing good happens when the prospect acts as the expert!

Remember, the prospect DOES NOT know what they need to solve their pain points.

If they did, they would have solved them already.

On the other hand, you are the REAL expert who has the solution to their pain points.

You can fill the void in their business life!

That said, power falls into the prospect's hands unless you assert yourself as the expert on the situation.

Ultimately, you lose the sales deal while the prospect does not get the solution they need!

Unfortunately, the moment you negotiate is the moment you forfeit your expert status while empowering the prospect as the expert.

It is a total lose-lose scenario!

 

What are the steps of negotiation in sales?

 

How to Never Have to Negotiate With Another Prospect Again

 

Negotiating with prospects is an absolute no-no.

However, negotiations are inevitable unless you take control of selling to prevent them from happening!

That said, this is how to prevent negotiations so that you never have to negotiate again.

These techniques help you establish yourself as an expert.

Ultimately, prospects are less likely to negotiate the more you come across as an expert.

 

Develop a Highly-Effective Sales Process

To begin, the quality of your sales process determines whether or not a prospect will negotiate with you in the end.

The sales process is your opportunity to show the prospect you are an absolute expert at what you do.

The more prospects believe you are an expert, the less likely they will negotiate with you.

Thankfully, I’ve already developed a full-proof sales process to help you clearly portray yourself as the expert who you are!

Instead of a multi-step process, this process takes only a few steps to generate leads and convert them into new customers.

Every top sales professional has a repeatable process ready to deploy at any moment and keep negotiations at bay.

 

Shorten Your Entire Sales Cycle

How long is your current sales cycle? 

One month, two months, or even three months?

If you and your team members are like most sales teams, it takes you an average of a few months to convert a prospect into a new customer.

Unfortunately, the longer your sales cycle, the more likely prospects are to negotiate!

The longer your cycle gets, the more ambiguous your message becomes. 

The more ambiguous your message, the more confused prospects become, and therefore the more likely they are to negotiate.

Consider this- When you visit the doctor, they do not waste time getting into the appointment.

Instead, they cover a lot of information in little time, which reinforces their expert status.

Similarly, keeping your sales cycle short and sweet decreases ambiguity to increase perceived expertise.

Thankfully, the sales process I’ve outlined above helps decrease sales cycle length.

 

Never Give Away Free Value

Are you a religious user of the free initial sales proposal?

When a prospect asks you to send them a proposal early in the sales cycle, are you one of the majority of sales reps who willingly obliges despite despising proposals?

The moment a salesperson sends a free initial proposal is the moment 100% of control falls into the potential customer's hands.

More importantly, it is the moment the prospect becomes the expert in the situation.

How is the prospect qualified to look at a proposal and determine whether or not it is what they need?

Of course, they are not qualified because they are not the expert in the situation!

As a result of sending a proposal, the prospect will likely wait for weeks or months while you anxiously await a response. 

Once they respond to the proposal, they hit you with calls for negotiation because they have assumed themselves as the expert.

The moment you send a free value-filled proposal is the moment you open yourself to negotiation.

 

What are the rules of negotiating?

 

Never Offer More Than One Option

How many options do you offer prospects at the end of your final sales pitch?

For example, do you offer three different service options, each with a different price and a slightly different range of services?

Whenever you offer more than one option, you send the message that the prospect is supposed to know what is best for them.

It is as if you spent the entire sales process convincing the prospect you are the expert only to ask them what they think they need to fix their pain points.

As a result, prospects put themselves in the driver’s seat to start negotiations.

Instead of offering several options, create one solid offering at the end of your final sales pitch.

That way, there is no confusion that you know what is best for prospects.

 

Speak Directly to the Decision-Makers From the Start

If you are a sales rep at a new company and have an important question, who would you ask the question to if you want the best answer?

Would you go to a fellow newbie sales rep or your sales manager?

Of course, you would go to your sales manager.

Similarly, if you want the clearest answer from a potential customer, you should go to the person at the top of the food chain. 

AKA, you should go to the person with authority to make purchasing decisions.

If another person manages communication between you and the decision-maker, odds are your message will get lost in translation. 

The more lost the message gets, the more likely the decision-maker will object to your final offer.

Therefore, from the moment you generate leads to the moment you lay the deal on the table, ALWAYS communicate with the person who holds the purchasing power.

 

Make Sales Pitches Like the 1% Do

Sales pitches are your single-most valuable opportunity to blow the socks off of prospects!

Pitches are sales conversations in which you establish yourself as an expert in your field.

During pitches, you show prospects that you have a solution they cannot afford to live without! 

Unless they close the sales deal with you, all of their business goals go into jeopardy.

The top 1% of sales professionals use pitches to establish themselves as a non-negotiable business partner.

Thanks to their killer pitches, prospects do not even consider negotiating with them.

Not only that, but making killer pitches enables salespeople to close sales deals with almost anybody they want!

On the other hand, if you make pitches like the other 99% of salespeople, prospects are less likely to see you as an expert and more likely to walk all over you.

Can you pitch as if your life depends on it?

 

Final Thoughts on Sales Negotiation and Why it Is a Bad Idea

 

Nobody likes negotiating - not you and not even your prospects - so why continue to put yourself in that situation?

Quit setting yourself up to lose by constantly negotiating.

The longer you continue to negotiate, the more time, money, respect, and deals you will lose!

Win more deals. Grow your business.

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