The news that Unilever and Tesco have so quickly resolved their price dispute makes it seem as though this was all rather straightforward. In my experience this is unlikely – there is often a great deal of complexity and the emotion on both sides in this type of negotiation especially if it has resulted in brinkmanship – in this case Unilever ceasing to supply.
Although we think we’ve watched these two corporate giants battle it out on the business stage, we’ll never know exactly what happened at the negotiating table. However, we can be sure that similar price negotiations will be taking place between suppliers and retailers throughout the UK.
So whatever side of the fence you sit on – whether you’re a retailer or supplier – here are our top 3 secrets to help you negotiate a win-win deal.
1. Hold Your Nerve
Given the current economic climate where profit margins are being tightened, both suppliers and retailers are under pressure to focus increasingly on price. It’s therefore more important than ever to hold your nerve before, during and after negotiations. When you are faced with tactical behaviour, it can be easy to end up paying for the relationship so remember “never concede for no return”. Draw on your resilience and resist buckling under pressure – whether it’s pressure from the other party or from your own colleagues. Instead stand your ground and be confident about your decisions. Remember you decide the price of your goods or services and you shouldn’t justify your decision.
2. Keep The Negotiations Moving Forward
Communication is crucial to negotiating successfully, so try to keep the dialogue flowing. Listen and be empathetic to the other party’s particular challenges but remember that doesn’t mean you have to pay for their problems. Instead try and bring new variables to the table to broaden the deal, such as a longer-term joint business plans or initiatives. By introducing new trades, you are more likely to avoid deadlock and keep the negotiations moving forward so you can agree a deal that benefits both parties.
3. Balance The Playing Field
Remember that ultimately both retailers and suppliers need each other to be successful in the long term. When I was a supplier negotiating complex deals with major retailers, I used to reverse the roles in my head and tell myself that they need to convince me why I should invest in their routes to our customers. By balancing the playing field in your mind, you will help feel more confident during the negotiations and this will increase the likelihood of you achieving a win-win situation.
I hope these negotiating top tips will help boost your commercial confidence when you next negotiate a price increase for your goods or services for, as Maureen Dowd so wisely said, “The minute you settle for less than you deserve, you get even less than you settled for.”