In this article, we talk about the top 5 key skills for how to negotiate the sale of your business. Read our previous articles for a fully comprehensive guide on Selling a Business in Canada in 2020.
- Selling your business: When is the Right Time to Sell and For What Reason
- Should You Sell on Your Own or Use a Business Broker?
- How to Optimize Your Business Ready to Sell
- Instructions to Value Your Business and Comprehend It’s Worth
No matter how counterintuitive it may seem, both sides involved should gain from a successful negotiation. There is a way to build trust and strike a fine deal as quickly as possible and we broke it down to 5 main points to remember for you.
The best strategy you can follow in any negotiation is to give the other party what they want. Counter-intuitive, isn’t it?
However, in fruitful negotiations, the idea is a win-win situation, so both sides gain.
Negotiating can feel confrontational, and this is the part where the difficulty lies. Defende what you need. Contende at a better deal. – Many people equate these processes with strife (to be evaded) rather than an unavoidable part of working towards a reciprocally gain.
The great news is, negotiating is a skill that can be learned.
We don’t suggest you launch your negotiating career with your first business deal, but with training, practice, and development, negotiating a deal can be less complex than you may envision.
Great negotiators are:
- Good planners
- Win-win oriented
- Good communicators
- Aware of themselves and other people
1. Attention to Detail and Planning
Planning is crucial in sales negotiations. Determine your base accepted outcome, your anticipated accepted outcome, and your ideal. Likewise, settle on your ‘choice B’ if negotiations fail. Great planning comes from information and insight, so research the purchaser thoroughly. Also, take the time to meet them personally throughout the due diligence process.
There isn’t anything more terrible than unexpectedly understanding that you don’t know a key fact or figure while at the negotiating table. Conceding that you haven’t gotten your work done or scrambling through papers attempting to discover the appropriate response doesn’t glance great before the other party (or your own group).
The best negotiators are the individuals who are the best-prepared. They’re not just certain about their insight into their own business’ context and requirements, but they have put a huge time in learning the same about the other party.
Remember that even the tiniest detail might be the factor that determines the end result of a negotiation. For instance, a provider may see that environmental sustainability is referenced in the initial pages of the buying organization’s yearly report and could use this information to stretch their own credentials at the negotiating table.
With regards to negotiations, have a clear idea of the other party’s expectations and desires.
2. Be clear for the Sale of your business
Show up to any negotiation with a plan and present it calmly. Keep the presentation brief but comprehensive. Be clear about the things you are offering and what you need from the other party.
Consider what the other party needs from the arrangement and take a complete view.
3.Strive for mutually-beneficial solutions
Negotiating is tied in with the planning for a bargain. By posing lots of inquiries and focusing on all subtleties, you can arrange a deal that is commonly beneficial.
The primary offer/proposition is rarely the one to be accepted, so make certain to examine compromises and make and receive concessions.
4. It’s all about closing the deal
As you negotiate your deal, be aware of the signs that your deal is arriving at its end. The other party’s counter-arguments may lack energy, they may show signs of tiredness through non-verbal communication (body language) For example, an exhausted lean at the table, or you may find there is a convergence on the position you are both taking.
This is a perfect time to present closing statements, put decisions into paper, and follow-up quickly on any commitments made.
5. What if negotiations For the Sale of your business fail?
From your initial planning, you need to have your minimum acceptable sale outcome. Even so, if that isn’t met, it’s wise to have an option C. In the trade, this is referred to as your ‘best alternative to negotiated agreement’ or BATNA.
Utilize this back-up option as a spot from which you can brainstorm to keep the negotiations going. There is also big power in walking away. – So, if you’ve reached the limit of your negotiating skills, you can invite a third-party mediator into the sale.
At the point when you’ve agreed initial terms, the lone thing that remains among you and a fruitful sale, at the price agreed, is a smooth due diligence process.
• Negotiation Skills – Checklist
1. Pay attention while exploring providers before an exchange.
2. Have an adaptable mentality to change your strategy as required.
3. Put yourself in the other party’s shoes and be an active, empathetic listener.
4. Utilize information and compromise strategies to tackle issues on the fly.
5. Employ persuasion to decide the best way to deal with the negotiation or persuade a hesitant party during the discussion.