The process of export business negotiation is usually long, many times frustrating and causes a lot of anxiety. It requires skills, talents, techniques and is an art of its own kind. Export business negotiation is as crucial as any other component that leads to the success of the export business. When you dont negotiate well then the bottom line is adversely affected leading to business failure or unnecessary delays with a lot of back and forth movements.
Below are some Tips/facts to consider when preparing for a successful business negotiation.
Phases of negotiations
Business negotiation can be categorized into four phases-
Warm up
Re-treat
Actual negotiation
The agreement.
Knowledge of product
It is important to have detailed knowledge of:-
The product
The competitors
Consumer preferences
The market trends
The prices of the competitors and your own pricing structure and margins
The power of listening
It is a well known fact that listening is the most powerful tool in any discussion.
Give the discussion maximum concentration it deserves,
Do not interrupt or interject during the deliberations
Try to understand and ask open questions to extract more details.
Emulate a lot of empathy.
Talk less as this leads your opponents to tell you more.
Use the power of silence
Give discounts in relation to volume(order size) or payment terms
Cultural differences and etiquette
Good business negotiators are usually referred to as tough, with a lot of business acumen. It is important to do some research on the culture of your business partner. Some cultures in the middle east and most of Asia might require you to socialize before the negotiation process kicks off. This melts the ice and sets the mood right for them. Try and understand the cultural believes and myths of your partner. Direct eye contact is acceptable in some countries in others its impolite. Avoid a lot of body language as these are interpreted differently in different countries.
Interpretation or translation
In case of a language barrier, It is important to have a fluent translator as accuracy of business translation is crucial for proper understanding and success.
Be in control
Be firm with your decisions a no should mean a no.
Touch on issues that are non negotiable as this gives you an edge over your opponent.
Keep things moving dont allow backtracks.
Once an issue is settled mark it as so.
Keep a business and professional outlook and attitude.
Stay focused with mental stamina.
It is important to find out what the buyer really wants.
Some buyers complain and try to intimidate the exporters into reducing the prices.
Never be intimidated by a buyers unreasonable demands.
Never beg for an order, but negotiate for it.
Cultivate a win/win situation
Test the understandings and offer face saving moments during and after the negotiations.
Suggest signing of the document or leave it on goodwill and good intent basis.
The negotiated instrument
Clearly define the laws of the land that will govern and will be applied to your agreed negotiated instrument. You should include an arbitration clause for any eventuality. State and include the mode of payment clearly as agreed upon.
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Phoebe Owuor is a CBI trained export consultant and senior consulting partner of Hamerkop Exports Limited. View Profile
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