November 24, 2022
Tips -
10 Tips to Negotiate like a Pro and Get the Best Deals from Suppliers | OneLink Holdings
Want to get the best deals from your suppliers? Check out these ten tips on how to negotiate like a pro!
As a client, you always want to get the best deals for your company. To do that, you need to be a great negotiator. Here are 10 tips from OneLink Holdings on how to negotiate like a pro and get the best deals from suppliers.
1. Always Be Prepared
The first step to being a great negotiator is being prepared. This means knowing what you want, what you need, and what you’re willing to give up. The most important details to consider before beginning negotiations include price, value for money, delivery times, payment terms, after sales services such as returns for faulty products and the manufacturing quality of products. You should be clear on which conditions you are willing to compromise on and which ones you are firm on. Once you have this established, you can go into any negotiation with confidence and clarity.
2. Do Your Research
In order to get the best deal, you need to know what a fair price is. This is where research comes in. By knowing the market value of what you’re buying, you can ensure that you’re not being taken advantage of by the supplier. Researching your supplier is also valuable, as understanding how valuable your business is to them can influence your bargaining power. If the supplier owns the monopoly market, they are likely to have an upper hand because they have enough business already. If the supplier is new to the market, or has several major competitors, they may need to increase business and their market share, so your negotiating power may be stronger.
In some cases it is better working with a second of third tier supplier who will provide you with better service and usually competitive prices. They are trying to catch up with their competition so they are sometimes more hungrier for your business and retaining a long term working relationships. Top tier suppliers can sometimes get complacent with all of the above.
3. Know Your Limit
It’s important to know how much you’re willing to spend before going into any negotiation. If you have a set budget, make sure that you stick to it. Otherwise, you may end up spending more than you wanted to in order to get the deal done. If the supplier offers a low price for goods, there may be a reason why. The quality of the goods may be lacking, or turnaround times might be longer. It’s important to ask the supplier why they have offered a significantly lower price than what you were expecting. The supplier might include extra features in your goods production that you don’t necessarily need which could be removed for a lower price.
On the other hand it is important not to negotiate too hard where the quality of your product is compromised, don’t forget the factory has a million ways to reduce the price and these all relate to the quality.
4. Start High
When it comes time to start negotiating, it’s always best to start high. By doing this, you leave room for the supplier to come down in price without going over your budget. You should never accept a first offer made by the supplier, as there is room for a revised, lower figure. By making a lower counteroffer in return to the first offer, the supplier will likely come back with a lower revised figure. If you’re planning on making multiple large orders a month, asking for bulk discounts can also help in receiving a lower figure.
It is best to ask the supplier to provide you with a quote based on your yearly forecast. From here you have an idea of the nest price possible and can try to achieve that on your smaller orders.
5. Use Silence as a Weapon
One of the most powerful tools in any negotiation is silence. When you’re silent, the other person feels the need to fill the void and will often make concessions just to keep the conversation going.
You can let your supplier know you are checking the market or calculating landed (delivered) prices to see if their price is competitive or not. If you think there is room to negotiate further you can explain your added freight costs and where they would need to be to be successful with your order.
6. Don’t Be Afraid of Walking Away
7. Be Willing to Compromise
While it’s important to stand your ground during negotiations, it’s also important to be willing to compromise when necessary. If both parties are unwilling to budge, then no deal will be reached, and everyone loses out in the end. If you’re wanting to do business long term with the supplier, striking a deal that both parties are happy with will lead to successful future transactions with the supplier.
8. Be Clear and Concise
When making your points during negotiations, be clear and concise so that there is no misunderstanding about what you want or what you’re willing to give up. This will prevent any miscommunication that could derail the entire process. Every time an agreement is made on an individual point, ensure it is written down so you can go back over if necessary.
9. Take Emotions Out of It.
It can be easy to let emotions get in the way during negotiations, but it’s important not to let them cloud your judgement. Always remember that this is a business transaction and should be treated as such. The negotiator shouldn’t let pressure force you into an agreement on a less than desirable figure. Remember, if you are unsure, ask for clarification from the supplier.
10. Have realistic expectations.
Going into any negotiation, it’s important that you have realistic expectations about what can be achieved. If your expectations are too high, then it will be difficult, if not impossible, to reach a deal that everyone is happy with. On the other hand, if your expectations are too low, then you may end up selling yourself short. Businesses are usually focused on getting the best possible deal in the short-term, however a good relationship will serve of great benefit in the future as they may get cheaper prices or other perks such as priority delivery.
Once an agreement has been reached, it is time to draw up a written contract which needs to be signed by both parties. While verbal contracts can be used, having a written contract will enable both parties to go back and view the points of agreement. The contract should include details of the price agreed, the payment terms and delivery times as well as clauses for both the supplies right to the products until fully paid and contractual liability of products. In the event of poor quality, returns and refunds it is important that these terms are stipulated in the contract.
These are just some tips that can help improve your negotiating skills and help you get better deals from suppliers. Remember, every situation is different so it‘s important to tailor your approach accordingly. The most important thing is to stay calm, confident, and collected throughout the entire process so that you can get the best possible outcome for your company.
Negotiating with suppliers can be tricky but by following these tips, you can boost your chances of getting favourable deals for your company while still maintaining good relationships with your suppliers.
Don’t want to do the negotiating on your own? OneLink Holdings can do the negotiating for you. We have a team of experienced professionals who are experts at getting the best possible deals on the products you need. We know how to negotiate with suppliers to get you the lowest prices and best contract terms. Contact us today to find out more.
Written By
One Link Holding team
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