Forget About Win-Win in Sales Negotiations and Start Playing to Win
For far too many salespeople, win-win negotiation is a convenient excuse to justify why they gave the other side their maximum discount without a fight.
People, especially salespeople and those who manage them, often use the phrase “win-win” and negotiation in the same breath. The concept of negotiating win-win outcomes certainly makes sense in diplomacy, arbitration, and conflict resolution.
Win-win negotiation is a noble concept. It’s nice when everyone wins. If both sides can walk away winners that’s a good thing. But win- win should not be your primary objective at the sales negotiation table, because as a sales professional, your objective is to win for your team.
Salespeople delude themselves into believing that everyone needs to win in negotiations and that negotiated outcomes must be fair and equitable.
Yet, win-win negotiation is just another verse of “Sales Kumbaya.”
For far too many salespeople, the fixation on “win-win” is an excuse for avoiding the uncomfortable and natural conflict inherent in negotiation. It’s a cop-out—an easy way to justify why you just gave the other side your maximum discount without a fight.
You Cannot Be Delusional and a Good Negotiator at the Same Time
Here’s a brutal truth that you need to internalize: Win-win negotiation is the warm blanket of delusion where your commission check and your company’s profits curl up to die.
Salespeople who lead with a “win-win” mindset get destroyed at the sales negotiation table because (trust me on this) your buyer isn’t negotiating with you for a “win-win” outcome. They are negotiating to win for their team. Savvy buyers know exactly how to leverage the win-win-fair-and-equitable mindset to move salespeople from positions of strength to positions of weakness and then pick their pockets.
Win For Your Team
When salespeople engage in sales negotiations with a focus on “win-win,” the most likely outcome is that they allow their eagerness to make their buyer happy—falsely equating a happy buyer with winning—and to override reason and give away the farm.
Your job is to win for your team. But even when your negotiating position is strong and you have the leverage to extract maximum flesh, winning at the expense of your buyer or causing them to lose face can create resentment that will cost you dearly down the road. Winning for the sake of winning is a poor long-term strategy.
Therefore, sales negotiation is often a paradox—a dual process of empathy and outcome; you must win for your team and protect your relationships.
Resentment is a monster that degrades and destroys relationships. Resentment can go both ways. When stakeholders feel that you took advantage of their weak position or lack of information, it may seriously impact the future of your relationship. On the other hand, when you give too much away and feel resentment at being used or taken advantage of, it can negatively impact how you and your team value, serve, and interact with your customer.
I’ve been there and have the scars to prove it. I’ve negotiated poorly from a position of weakness and ended up hating my customer for it. The contempt I felt for them eventually caused the business relationship to unravel. It was not my customer’s fault (they were winning for their team). It was mine for allowing it to happen and not considering the unintended consequences of inking a bad deal.
Some buyers get this. They are good partners who understand the negative impact that resentment has on relationships. These buyers are good partners. They focus on negotiating the best deal for their company while remembering that you must also make a profit.
Yet, sales negotiation is woven into the fabric of the long-term relationships you have either built or hope to build with your customer’s stakeholder group. Except in purely transactional sales, in which the long-term relationship is unimportant, you don’t negotiate to win in a vacuum.
In sales negotiations, you cannot lose sight of the lifetime value of the relationships you’ve developed and nurtured. In other words, relationships matter and must be protected.
Far more often though, buyers are either too myopic to understand this concept. Sometimes they don’t care. This is almost always true when you are dealing with procurement.
Procurement (sometimes called purchasing or contracting) has a singular mission: to extract the best terms for their organization and squeeze the maximum discount out of you. They don’t care if you make money or if the negotiated terms and conditions handcuff you and make it difficult to serve them. When the dust clears, they won’t be dealing with you.They’ll hand you back to the account stakeholders and wash their hands of it all.
Be the Adult in the Room
But it is not the buyer’s job to think ahead to the unintended consequences of a lopsided deal and the resentment that it might cause for either party. It is your responsibility to think long-term and consider the lifetime value of the customer.
There are times when:
You’ll need to be the adult in the room. You must rationally and logically consider the best interests of both parties. You must be willing to make the right decisions and, at times, sacrifice a short-term win for a long-term relationship.
The buyer’s jugular is exposed, and you can easily go in for the kill, but you need to pull back, play the long game, and allow them to save face in the.
You need to transparently and honestly explain to the other side the negative impact on service delivery and customer experience when all of the profit is drained from the deal or the terms and conditions of the agreement are not aligned with.
You’ll need to walk away from a bad deal. Rather than risking the long-term relationship with your stakeholders (and your reputation), let your competitor crash and burn in their win-win negotiation so that you can live to fight another day.