Negotiating When You Have No Cards

In an entrepreneurial venture, you often don’t have negotiating leverage. You are anxious to get customers and even more anxious to complete an investment. When it comes to vendors, you don’t represent a large volume of business. In these scenarios, you need them more than they need you. Unfortunately, this puts you at a disadvantage when it comes to negotiating. You can’t let this limitation cause you to strike deals that are not in the best interest of the company.

“We WILL get through this together.” 

you must come to the table with tools and insights that put you more in the driver’s seat. Think about the following:

  • 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:
  • Influence Points. You often don’t need to have leverage to create other influence points. On your own, you may be a small company that no one knows about. What if you tied your business to another influence point? For example, what if you are a customer of Valley Bank and you want to offer your solution to the bank. You might reach out to your relationship manager and express your desire to offer your solution to the bank. Your business with the bank will give you an improved chance with the opportunity.
  • Align to Your Target’s Competitors. Sometimes companies create relationships because of the value. Other times companies take action to prevent or preempt your relationship with one of their competitors. Communicate that you will be offering your solution not only to them, but that you believe that other similar companies (that they happen to compete with) would benefit from your solution.

Negotiating is both art and science. Practice is as often as possible.

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