Negotiating When You Have No Cards

“We WILL be there with you every step of the way.” 

Negotiate from a Position of Strength

Don’t allow any customer, investor, employee or vendor to hold your size or stage against you. Put differently, even though you really want (or need) a relationship, always negotiate from a position of strength. How do you do this when you have little leverage? It will require your entrepreneurial creativity to create leverage when little exists. Easier said than done. You’ve got to bring all of your creative juices to give yourself the influence and edge to negotiate with strength. You may not realize you already have this strength or won’t discover it until you refuse to negotiate from a position of weakness, regardless of the circumstances.

Here are a few tips to help you negotiate from the right place:

• Competitive Process. Whether it is a vendor or an investor, hold a competitive bid process. When you have narrowed your selections down to few (or one), or if you are left with one selection, this need not be shared with these parties. Parties vying for your business should understand that they are competing with others.
• Attitude. Sometimes your attitude, body language, and tone can be compelling enough to create leverage. Shift your passion for your vision into a natural confidence. Communicate that the success of your business is not a matter of “if” but “when”. Regardless of your stage, always negotiate from a position of strength. Pay attention to the principle of least interest even if your interest is greater and always behave like you want a relationship, not that you need a relationship.
• Never Let Anyone Be the Only Source. There will be times during your company in which you will only have one source for a solution. This most often comes up with vendors and investors but may also apply to customers and employees. Ideally, you should always have several sources for a solution. In early stages, this is not always possible. When it is not possible, the party that is your only solution should not know that they are your only source. In a perfect world, these relationships would appreciate that this venture is your vision and would never take advantage of the fact that they are the only source. Unfortunately, you must accept that some resources will leverage this knowledge to your disadvantage.

There is a certain reality to an early stage business. You don’t have a lot of dollars. You can’t make large commitments. You don’t know your volume. You can’t promise the future. Even so, you still have to find a way to negotiate favorable relationships with the company. If you keep your perspective aligned to negotiating from a position from strength, and can use some of the techniques described here, you can strike a good deal even if you are offering ice to Eskimos.