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Thursday, July 2, 2009

Outside the Frame, July 1 show recap

On Wednesday’s Outside the Frame show we discussed The Art of Negotiation which is important to artists as at some point in their career, they will need to sit down to the negotiating table with a client in order to land the big commission, gain gallery representation, or capitalize on secondary market sales – along with handling their client’s objections appropriately in order to land a sale. Additionally, negotiating skills are required to effectively deal with clients (even the difficult clients) to reach satisfactory terms and maintain good working relationships.

I hope you listened for the “tip of the day” and wrote it down to be eligible for the Outside the Frame Listener Appreciation Drawing at the end of July where you can win an 11”h x 14”w matted print of my work, “Whisper Rock”. See my Outside the Frame blog for full details.

Simply put, negotiation is a discussion intended to produce an agreement. We use negotiation in our daily lives with our friends, family, co-workers, and spouses even though we are often unaware we are doing so. For instance, if you convince your partner to view a movie they initially did not want to see, that is negotiation. If you were able to convince them to view the movie, and at the same time, make them happy they’ve attended; that is successful negotiation. How can you make them happy? You make them an offer of “conciliatory exchange” or simply put – a trade off – such as “you see this movie with me and I will (insert something your partner likes here) for you this (insert day/time/date here)”.

Effective negotiation is an art that requires preparation and practice in order to be successful. Your goal is to perfect your skills at negotiating so that your outcome is a win-win resolution in which both parties walk away from the table winners. Negotiation is a process that can be learned and the following rules and tips will help you:

Everything is Negotiable: Don’t narrow a negotiation down to just one issue. Develop as many issues or negotiable deal points as you can.

Crystallize Your Vision of the Outcome. If you can visualize the end result, you will most likely be the one who will guide the negotiation toward that end.

Prepare in Advance – Information is Power. Obtain as much information as possible before you sit down to negotiate to make sure you understand the value of what you are negotiating.

Ask Questions. You have time to ask questions and to clarify any information that you do not understand or were unable to attain. Very few negotiations begin when both parties arrive at the table.

Listen – Good Listening is the Key to Negotiation. In doing so you can gain ideas for creating win-win outcomes, as well as, make the other party fell cared for and valued.

Set a Goal for Each Deal Point. Define your minimum level of acceptance for each goal. If you are not clear on your goals, you will end up reacting to the propositions of the other party.

Aim Your Aspirations High. Your aspirations will likely be the most important factor in determining the outcome of the negotiation.

Develop Options and Strategies. Successful people are those who have the greatest number of viable alternatives. Successful negotiators have developed many strategies that they can use to turn their options into reality. They come to the table with several routes to their destination, not just one.

Be Adaptive. Adapt your strategies and behaviors to suit your counterpart. Even when negotiating with someone who leaves you little room to negotiate, you still have a strategy to suit – you can simply leave the table.

Be Honest and Fair. What goes around comes around. The goal in creating win-win outcomes is to have both parties feel that their needs and goals have been met. This way, they will be willing to come back to the table and negotiate again.

Never Accept the First Offer. Very often the other party will make an offer just to see how firm you are on key issues. Likely, this is an offer they are sure you will refuse. If you don’t have to fight a little for what you want, you probably won’t get the best deal.

Deal From Strength – If You Can. If you cannot deal from a position of strength, then create the appearance of strength. If the other party thinks you have no reason to compromise in your demands, they will be less likely to ask you to do so.

Find Out What the Other Party Wants. Concede slowly and call a concession a concession. Giving in too easily tells the other party that you will be open to accepting even more concessions.

Be Cooperative and Friendly. Being rude, abrasive or combative only serve to break down negotiations. Negotiations should not be adversarial, with the intent to win at all costs. Negotiations are give and take conciliatory agreements where both parties win.

Use the Power of Competition. Sometimes just the threat of competition is enough to encourage concessions. If the other party thinks its necessary to compete for your business, they may be willing to give away more than they had originally intended. Use caution here, however, as you do not want to be branded a liar.

There are no shortcuts to successful negotiation. The most important thing is to know what you really want. Many people enter into negotiation only to find out that they did not have a clear desired outcome in their own mind. Write down your desired outcome as concisely as possible and use this as the center point of your preparation. Here are some preparation tips that will help you:
Know Your Opposition. Learn as much as possible about whom you will be negotiating with – find out their strengths and weaknesses, their wants, their likes and dislikes.

Timing and Method Matter. Initiate the negotiating process and whenever possible make it face-to-face as this will allow you to have the advantage of preparation and timing.

Be Prepared to Walk Away. You are in your strongest negotiating position if you are prepared to lose it all.

Prepare Your Presentation – Point by Point. Outline your presentation listing each point and their benefits to each party.

Anticipate Reactions. In your mind, anticipate the other party’s reactions, objections and responses to each of your points; list positive alternatives and examples to counteract the negatives the other party may have.

Begin With Agreement. Initial agreement on minor issues or points early on sets a positive atmosphere for agreement later on more significant issues or points.

Determine Consequences. A clear understanding of paybacks and consequences for each party in the negotiation makes it easier to determine when and how to make concessions and when to stick to your guns.

Prepare Options Rather Than Ultimatums. You should approach every negotiation with options and alternatives that reduce defensiveness and lead to a positive resolution for both parties. An ultimatum should only be used as a last resort and only when you can back it up – and then only when the other party knows you can back it up.

Get Comfortable With Silence. Silence can be a powerful negotiating tool. Practice holding back on comments and responses and don’t feel compelled to jump in with arguments or comments every time there is a pause in the interaction.

Close All Negotiations on Agreement. When you are ready to end your negotiation, do so on a positive note by clearly outlining any conclusions or agreements that have been reached.

Dealing with customer objections is a part of everyday business, especially in sales. Whether the client’s objections are “pre-sale objections” or “during-service objections”; take a step-by-step approach when handling objections. 1.) Find out what the objection is; 2.) Question the objection to try to find (or guess) the root cause of the objection; 3.) Acknowledge the objection; and 4.) Try to highlight the other benefits of your product or service. Above all never lie or exaggerate, as this is the worst thing you can do with your customers.

Difficult clients are a reality that every profession is faced with, however, you can handle the difficult client effectively when you learn how to recognize the various types (these are available on the podcast) and how to arm yourself in self-defense. The first and foremost weapon in your arsenal against the difficult client is the CONTRACT, AGREEMENT, or PURCHASE ORDER. Clients can be the most difficult part of doing business, but without them, you are out of business. Learning how to handle difficult people takes some time and practice. Here are some key points to keep in mind:
1.) Always have a signed contract before work begins; 2.) Treat clients as you would like to be treated – adopt proper procedures from the start with regards to contracts and payments; use these procedures with all clients – not exceptions; 3.) Get everything in writing – put everything in writing; 4.) Be firm but fair when it comes to money and time. Set prices based on what it costs you to do business rather than pulling a number out of your hat. 5.) Avoid value judgments; above all, don’t make it personal and they won’t make it personal; 6.) It is your responsibility to clearly communicate your expectations to your clients so that they can know how to deal with you. Otherwise, they are completely in the dark and naturally assume everything is fine. Listen to the podcast to find out how to handle your most difficult clients and the three choices you can present to them. Tune in to next week’s Outside the Frame where we will talk about the artist’s nemesis: Rejection.

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