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Tips and Strategies for Sales Negotiation

Think of a situation at work when you are in a meeting and want to contribute your ideas. However, there’s always the possibility that the team would not agree. And you would like to try pitching why your idea is feasible and talk about it – and with negotiation, they may change their minds.

This is a perfect example of how negotiation takes place on a typical day.

And whether you love it or hate it, the negotiation process is part of life.

More so in the field of sales.

Generally, the negotiation process aims for a mutually beneficial outcome for both parties involved. Thus, it takes a lot of discussions to arrive at a win-win outcome.

The word negotiation can bring a pang of anxiety to many. But for sales professionals, it may be a lot worse.

However, according to the president of RAIN Group, Mike Schultz, negotiation today is much more different than how it was decades ago.

 negotiation sales

In sales, the negotiation process, we think of closing big deals and discussing contract terms, proposals, and compensation grants. And yes, the stakes are much higher in these kinds of negotiations.

Therefore, companies need to establish their sales negotiation strategies. Simply because you do not want to lose customers left and right just because a sales rep fails in the negotiation phase.

So if you are a sales manager, a sales rep, or a business owner who wants to know the basics of sales negotiation and how it works wonders for your sales process, then you are on the right article!

What is Sales Negotiation?

The primary goal of sales reps is to sell a product to customers. But sometimes, customers want something different. Either they want something changed, or they want something added.

And a majority of sales professionals know this! So this is where sales negotiations start to happen.

A sales negotiation can be defined as a series of strategic discussions between a sales rep and a customer to address the interests of both parties involved to find common ground.

The keyword to sales negotiation is compromise.

 what is sales negotiation

So the main goal for both parties is to communicate what they need and where they can make possible arrangements to reach a negotiated agreement.

Companies see the value of sales negotiation in completing the sales process.

In actuality, companies with no formal negotiation process cause a 63.3% decrease in net income. On the other hand, companies with a formal negotiation process experienced a 42.5% increase in net income.

 steps for effective sales negotiating

And the lack of a formal negotiated agreement can cause a massive backlash in the companies’ finances. Thus, effective negotiation is indeed essential for any type of business.

Without a formal sales negotiation, sales reps tend to act on default by giving away discounts or giving away too many deals just to close the deal.

Often, this can waste your time and resources, resulting in a lower revenue margin, impacting the overall sales cycle. So, sales reps need to follow a formal process for sales negotiations!

Here are five general steps for effective negotiating

1. Preparation and planning

Preparation and planning is the first step in the negotiation process. In this phase, you collect all the information you’ve gathered in the other sales process stages to be applied to the negotiation.

 negotiation sales training

In the early stage of the sales process, you could have collected your customer’s pain points and how they think they can solve them. You may have also collated the key stakeholders and their concerns and issues.

This phase allows you to prepare for possible questions at the negotiating table. Some questions may include:

  • Why is the other party trying to negotiate? What do I have that they need, and what adjustments can I make to address their concerns?
  • What adjustments do I want the other party to make? What are my objectives for the negotiation?
  • What are the agreed solutions to be implemented?
  • What is the best alternative to a negotiated agreement?

2. Define the fundamental rules

Setting the rules and guidelines is crucial to the sales negotiations process.

Think of your fundamental rules as a formal structure for the negotiation. It is where you set expectations and information that propose the meeting’s context and environment.

The fundamental rules can guide your sales team on how to go about the meeting and the overall sales negotiation.

Some of the following questions below can help guide you create your agenda for the meeting:

  • Where will the meeting take place? Will it be in their office or ours? Or someplace else?
  • How much time do we allow for the meeting? Are there any constraints in the schedule of both parties involved?
  • What are the key topics to be discussed? What are the possible concerns, issues, and objections?
  • Will there be non-negotiables? What topics are not allowed to be discussed?
  • What if there’s no negotiated outcome? How do we handle objections? Should there be another meeting? Or will this be the end of the sales negotiations?
sales negotiation training

Letting your sales team set fundamental rules before the sales conversations gives both parties the opportunity to impart what they expect so they can all appropriately prepare for the meeting.

Your sales negotiation may become more effective as both parties have a mutual and agreeable understanding of the things that can and cannot be done.

3. Clarify and explain your proposal

Now that your expectations have been set, the sales conversations can begin.

In this phase of the process, the positions of both parties are discussed, the deal specifics, most especially the price.

Each side of the party has the chance to explain, justify, and show support for their original demands. Negotiation experts believe that this phase should avoid becoming argumentative. But instead, it should let both sides educate and inform each other about their take on the discussion.

 sales negotiation skills

You can use different phrases that allow your customers to expand their thoughts about the discussion. For example, you can ask questions like, “Can you give your thoughts about…”, or “Can you help me understand this further…”.

Your customers always want to feel respected. Therefore, you mustn’t go jumping straight to the negotiation. Instead, just take time building trust and ensuring that you are able to answer the questions of your buyer while at the same time making things clear from your end. Check out the related guide, sales prospecting.

4. Work on negotiation and problem solving

Depending on your sales negotiation techniques, the bargaining and problem-solving process is a step towards coming up with a good deal. In this phase, negotiators often use different types of approaches to work on their proposed solutions.

Now there are three main techniques that are widely used in sales negotiations, namely: collaborative, manipulative, and neutral techniques.

Collaborative techniques are the ones that focus on having a mutually beneficial outcome for both sides which then enhances the value of the relationship. In this type of approach, many use the trade-offs such as exchange in options may it be in the value or cost of the product that works for the buyers and sellers.

On the other hand, manipulative techniques are mostly used when there is no value in creating a long-term relationship with a buyer. For example, those that sell products in malls may just be a one-time event. In this case, the seller may just be interested in getting the deal immediately, which can “trick” the buyer into accepting the deal. Some manipulative tactics can come in the form of making future promises that may convince a buyer to try out the product.

Lastly, neutral techniques are those that can be used by both collaborative and manipulative techniques. For example, setting a deadline. Setting a deadline may come off as pressure on a buyer, but it is also a critical factor in closing deals.

A good negotiator leverages the collaborative approach as it will result in a customer’s brand loyalty, repeat business, long-term engagement, and even a lifetime value.

By adopting a collaborative approach, the negotiating process proposes flexibility when you propose win-win outcomes and incorporate fair concession rates, added value, trade offers, a new proposed solution, and other soft behaviors.

 short sales negotiation

In negotiations through a bargaining strategy, making concessions remain reasonable but leaning more on making buyers concede to the pricing parameters set by the sellers.

In solving problems, being flexible means searching for better, mutually beneficial outcomes that satisfy the needs and interests of both parties. Thus, this approach is more focused on favorable agreements to which both parties agree rather than on just one party.

5. Implement and carry out actions

The final step in the sales negotiation process is to formalize the agreement and implement and carry out the final actions.

This is where the final say of the customer comes in. At the end of the negotiation meeting, both parties are expected to come to an agreement on the next course of action and when they should be implemented.


In most cases, this phase involves the presence of the legal department as well as putting together all contracts and legal documents that contains the outline of the details and formalizes the agreement.

The document can include the item pricing, list of deliverables, terms and conditions, timeframe, cancellation policies, etc. Explore some sales related guides, sales productivity, sales funnel templates, SaaS sales and sales analysis reports.

How do sales negotiations help a sales team and your business?

Now that the different phases of sales negotiation have been covered, it’s time that we let you understand how sales negotiation helps your sales team.

They say that there are many barriers to a good sales negotiation. But the wall that impedes the negotiation process from happening is one’s ego. And ego can be detrimental when it comes to the art of negotiating.

You see, sales negotiation is vital for both buyers and sellers. However, negotiation is a two-way street. Therefore, sales professionals should be able to understand why it is such a crucial factor in the overall sales process.

1. Close more deals

In conducting negotiations, one hard and fast rule is that both buyers and sellers should be in agreement. Thus, closing more deals should have both parties completely understand the sales process’s specifics, such as price concessions, contract terms, and additional benefits resulting in better win rates.

The negotiation success can create more deals and a more successful selling process which can further bring the company’s profit to a whole new level.

 sales negotiation examples

2. Increase win rates

When your sales team can excellently execute a sales negotiation strategy, you are sure to have an increase in your sales. Likewise, when your sales team knows how to negotiate, you can have more chances of getting a sales deal closed.

Sales managers know how crucial it is to have an efficient and competent sales team. Therefore, having an in-depth understanding can help increase your sales by offering more favorable payment terms and price concessions, providing more excellent value to your success.

 sales and negotiation training

3. Forge healthy salesperson-customer relationships

In sales, communication is critical. And much more in sales negotiations.

Sales negotiation is one of the many ways you can better communicate with your customers. It helps them feel respected by allowing them to feel that you value them. When sales representatives let a customer feel that they are open to sales negotiation, they show a willingness to listen and learn about their concerns making future purchases possible.

 sales negotiation guide

4. You can learn more about your customers’ needs

Sure, being profitable is primarily essential for sellers. However, when you want to make more deals in the future, you would like to make sure that you know what your clients want and need.

Do they want a lower price? Do they want to save money? Are they going to use your product for a one-time event? What makes a win-win agreement from their perspective? When talking to the decision-makers, sales negotiation can help you better understand what they are looking for in a product.

This can help your sales team strategize better and modify your products if needed.

 fundamental rules of sales negotiation

5. Create a compelling counter-offer

Understanding sales negotiation can help sellers provide a compelling counter-offer to buyers who want a change in a specific purchase. But, again, it should not result in a heated argument. Instead, with the right sales negotiation skills, a rep can stay calm about it and propose another deal that can result in a mutually beneficial outcome.

negotiation in sales

Key Sales negotiation skills

Understanding the process of sales negotiation isn’t really enough. As a sales rep, you have to imbibe the right sales negotiation skills to be effective!

So what sales negotiation skills should your sales team have? Top performing sales negotiators have shared the qualities and capabilities that one should have to achieve effective negotiation. Here are some of them:

1. Assertive communication

As was mentioned, communication is key to any form of negotiation. Thus, good negotiation skills involve being both a good communicator and a good listener.

A lot of sales negotiation training typically categorizes communication into three different categories namely, passive, aggressive, and assertive communication.

 sales negotiation techniques

If you are a passive communicator, you may give in easily to the demands of your buyer. On the other hand, if you are an aggressive communicator, you may be too confrontational and pushy which can make your buyer feel disheartened in making the purchase. However, an assertive communicator can be confident and accommodating at the same time.

Being an assertive communicator allows you to clearly explain a deal for buyers to understand them better. An assertive communicator uses facts to support their claims, and their tone is strong, steady, and firm. This exudes confidence which can steer away from the conversation from being dry.

2. Full-scale listening skills

It is important that you allow your customers to speak first. In the process of talking with your clients, you have to understand where they are coming from. Therefore, as sales professionals, you have to actively listen to their thoughts, engage in a two-way conversation, and recall important details.

In this case, part of the sales negotiation skills is putting value in silence. You have to know the right time to talk.

 sales negotiation tactics

3. Preparedness

When you fail to prepare, you are bound to fail. So better arrive prepared rather than empty-handed. Sales negotiation skills training suggests that you have to check everything before meeting a client.

 sales negotiation tips

Preparedness may come in the form of doing research about your clients or bringing all the critical documents needed for the meeting. And sometimes, just showing up on time and observing proper decorum is a sign of preparedness as well.

Being prepared can mean you are reliable and professional.

4. Effective and clear explanation skills

Negotiation experts highlight the importance of clearly explaining all the important details to a buyer – especially in making concessions.

According to the Rain Group, cost or product price is a metric used 12 times more frequently than quality. Therefore, you have to be mindful of your proposal.

 sales negotiation ideas

Explaining your concessions effectively and clearly can help you define your limits when it comes to giving away discounts and freebies to your buyers.

5. Understanding the dynamics of negotiation

As sales professionals, you must have a complete picture of your client’s wants and needs. And, of course, as sellers, you also have requirements to meet from your end. When you have a full grasp of what both parties need, you can prepare for any alternatives which can be discussed by both sides.

By doing this, you can practice transparency and implement changes as you progress in the negotiating process.

 sales negotiation ideas for the sales team

6. Identify the decision-makers

Nothing is more important than identifying the decision-makers when making negotiations. It will be frustrating to persuade a buyer only to find out they do not have the final say in the company.

As a sales negotiation strategy, you have to know who you should deal with to modify your proposals as needed based on their interests.

 sales negotiation guide for sales reps

7. Patience

Sometimes negotiations do not immediately result in a closed deal. It is an inevitable possibility for some buyers to think things through, which can lead to further renegotiation and counter offers. Rather than pushing buyers to make an immediate decision, sales professionals should stay calm and collected while waiting.

When you practice patience, you can have the time to re-evaluate factors to arrive at a sound decision.

 problem solving in sales negotiation

8. Demonstrate value

Before entering the process of negotiation, you have to be confident that you are able to demonstrate the full value of your product. Once you are able to make your buyers aware of your product value, it will be easier to justify pricing because you come with proof.

So if you have your own research, case studies, and testimonials from other buyers, you have enough proof devices to support your negotiating claims.

 key sales negotiation skills

9. Stay composed and handle objections with grace

True enough, the world of sales can be a very stressful environment. Some customers may need to hear explanations multiple times but would still end up asking the same questions. It happens. But you do not have to be mad about it.

As you know, sometimes, no matter how much effort you put in negotiating with your buyers, things do not always go how you want them to. This can happen because of a lot of factors. For one, not all buyers would say yes.

Therefore, keeping your composure and being graceful when cutting ties with a buyer is a must.

Also, you must know when is the right time to walk away. Learn how to read the room.

One example is when some buyers tend to have many requests that your business simply cannot keep up with, even after several proposals, that would probably be a good sign to walk away.

 sales negotiation knowledge

10. Rapport-building

Most of the time, rapport-building is often underestimated. However, it actually is a crucial skill that every sales professional should master.

Simply because no one would want to start a conversation with you when you do not seem friendly and likable from the beginning. Sometimes, a little joke here and there will not hurt, especially when trying to break the ice.

However, the key to establishing great rapport is knowing how to draw a thin line between being friendly and being professional. Finding the balance can help you build connections while, at the same time, buyers will take your product seriously.

Customers always feel good when they feel they are being understood and listened to. However, this only happens when sellers have the ability to establish rapport from the get-go. Thus, building rapport to develop strong and healthy salesperson customer relationships is essential.

You need not worry about rising tensions but promote connections that help you become a step closer to making a good deal.

 sales negotiation process

11. Fast decision-making

A good negotiator is a fast decision-maker. Therefore, sellers can encounter situations wherein they need to decide fast, especially when it can make or break the whole sales cycle.

Say a customer asks you for a small discount for their larger amount of purchase. If that is the case, as a sales rep, you do not have to wait for the decision of your sales manager before moving along with the selling process.

Therefore, you have to equip yourself with all the information and details about your product so that when push comes to shove, you will not be rattled in any way.

 negotiation success in sales

12. Problem-solving

Sales negotiation skills training put emphasis on problem-solving skills. To achieve negotiation success, you have to be ready to put up feasible solutions whenever buyers raise their questions, hypothetical scenarios, and possible concerns.

When conducting negotiations, it is crucial that your buyers see that you know what you are talking about and you know what to do if problems arise. As sellers, this can instill trust and credibility.

 sales negotiation solution

13. Integrity

Having strong ethical principles is a fundamental skill any sales representative should have, especially in dealing with a customer. Exhibiting empathy, respect, and honest concern for your buyers allows them to trust what you say and do for them. Therefore, when you say something, make sure that you are committed to doing it. However, be wary not to make promises that are not realistic.

Top performing sales negotiators even believe that going the extra mile in being honest helps in negotiating better and closing a deal much faster!

 sloovi sales negotiation guide

14. Persuasion

Persuading a customer is obviously one of the most basic sales negotiation strategies. However, top-performing sales negotiators subtly use persuasion, especially when they have already established a strong rapport with their clients. It is much more appreciated when sales reps have a gentle approach making the selling process more encouraging and making a win-win outcome more possible.

In order to effectively persuade clients, you also have to bring your proof with you. You cannot expect people to just easily believe what you say. So bring in your statistics, testimonials, and other information that will make your pitch more believable.

 sales guide for reps

15. Knowledge

Of course, to make a good deal, you have to let your customers know everything about your product. Thus, knowing your product and services from the inside out can help you convince your clients more. In addition, you can emphasize its value to the buyer and help them decide to take your proposed deal.

Also, expect the key decision-maker to ask tons of questions beforehand. When they feel that you do not know what you are talking about, you just might find yourself losing that buyer.

 sloovi outreach tool

Sales negotiation tips you should know

There are numerous sales negotiation strategies that are used by sales professionals around the globe. However, as sellers, you always have to keep in mind the more excellent value for your business when you can give your buyer a great deal.

So here are some sales negotiation tips practiced by the top-performing sales negotiators!

Know your negotiation style

Before going into the sales meeting and negotiations, you must know your negotiation style. By fully understanding your negotiation style, you can fully adapt to your client’s personality and develop a sales negotiation strategy that works both ways.

Experts suggest that there are two kinds of approaches in doing sales negotiation, namely: The hard selling technique and the soft selling technique.

Hard sellers are usually those that are more direct in the sales negotiation, which sometimes uses high-pressure selling. On the other hand, soft sellers are those that guide a buyer rather than push them to make a decision.

In some cases, both types of approaches are used. However, they will heavily rely on the kind of decision-makers at the negotiating table.

Do not rush

One hard and fast rule at the negotiation table is to never rush your clients to make a decision. Instead, stay calm and collected all throughout the process and let your clients take their time to come up with a sound judgment – especially if they want to save money.

Not rushing can also mean that you get a bigger picture of your prospect’s overall priorities, goals, as well as purchase blockers. This can also help your customers make better decisions.

So, take your time to establish healthy salesperson-customer relationships and be open to them taking pauses.

Do not accept a bad deal (and never propose a bad one either!)

According to Chris Voss, a former FBI hostage negotiator, being fair is a powerful word in any negotiation process. Therefore, it is essential that agreements result in a win-win situation for both parties.

Negotiation experts suggest that both parties should feel that they won after the agreement has been made. In applying this kind of mindset, you are more likely to gain repeat and loyal customers.

So, it will never be good to just accept a deal just because you want to close one. Instead, both parties have to weigh the proposed solution before buyers and sellers come to terms.

But keep in mind that there are times that you may take a small loss, but can come as a bigger win later on.

Put everything into writing

It is highly essential for sales professionals to put everything in black and white. Top performing sales negotiators emphasize the need for documentation and placing everything into legalities for formalization.

The negotiated outcome and contract terms should be well-documented from the beginning as it shows total commitment and serves as a safety net for the parties involved.

Use exact numbers when discussing money

Your customers want clear and concise explanations. But this will become difficult to achieve when you provide them amounts expressed in ranges rather than giving them exact numbers. Giving amounts in a range can put sales reps in a difficult position, especially when you present the lowest amount you could go. Stick with your price, and let the buyer haggle so that the negotiation phase can begin.

Ask open-ended questions and listen carefully

Sales negotiations should be a productive conversation. When you are talking to a buyer and use questions that are answerable by a “yes” or a “no,” expect the conversation to be nearing a dead end. Instead, make conversations go back and forth by using open-ended questions.

For example, instead of asking a buyer, “do you think these price concessions work for you?” you may ask, “What can you say about our proposed price concessions?”.

Ask questions that would help the other party understand how they will benefit from the negotiation and make sure that they get a complete understanding of the agreement.

Remember that there’s a greater value in listening to your clients rather than you do most of the talking.

Analyze your sales negotiation strategies

Aside from honing your sales negotiation skills, remember that hard selling is a very difficult thing to master. So look into your approach from time to time and begin to analyze what works for you and what doesn’t. By analyzing your sales negotiation strategies, you are bound to improve your techniques in closing a sales deal.

Part of analyzing your sales negotiations strategies is also considering getting your sales reps into sales negotiation training. With top-performing sales reps and sales managers going into extremely effective negotiation training, they can advance their skills by undergoing structured training programs that will improve their overall results.

 negotiating process in sales

Negotiation skills are essential in every sphere of life, but most notably in the world of business. The ability to carry out a successful sales process lies in having sales negotiation skills that increase business win rates. In addition, becoming great sales professionals means being collaborative in the sense that they view their buyers as partners.

Another strategy that can be helpful is using tools that can make your sales process easier. A big part of sales negotiation strategies is communication.

 sales negotiation guide for sales team

Face it, overcoming sales negotiation hurdles require more than having a skilled negotiator and going into sales negotiation skills training. You also need to find the right tools designed to create valuable connections with all your sales activities and negotiation deals.

Therefore, it is crucial to look into various tools that can help you bridge the gap in communicating with your clients. After all, we cannot solely rely on traditional sales negotiation methods.

So when a client decides to take some time to make their final decision, the best alternative to setting up meetings would be email tracking and phone calls.

Many communication and sales management tools are available in the market today.

And one of them is Sloovi. Its integrated email functions and data analytics can help you better reach out to your clients, book more meetings, and collate all your sales data in one space.

The importance of sales negotiation cannot be overstated. So expect it to stay for good and start following these tips and finding the right tools that can help your sales team be on top of their game!