You Don’t Have to Make Negotiation a Part of Every Sale

I often get requests by sales mangers for negotiation skills training for their sales people when in fact upon further investigation their people usually need consultative selling skills training first. You cannot negotiate effectively if you cannot sell effectively first. Both are processes which need to be learned and applied in the correct order. However over 90% of sales people follow no logical process when selling or negotiating leaving their sales at risk.

Everybody negotiates all the time, at work, at home, and as a consumer and as a sales person. For some people it seems easy, but others view the process of negotiation as a source of conflict to be resisted and avoided if possible.

Negotiation is a process and a skill that can be developed. Negotiation can be described as a process that involves two or more people dealing with each other with the intention of forming an agreement and a commitment to a course of action. In a sales environment, negotiation often involves a series of communications between two parties to form an agreement about the details of a sales solution.

In many cases, it is possible for a proposal to be generated that satisfies the needs of both parties. However, sometimes one or more parties may have to accept less than they had hoped for when they entered the negotiation process. And finally, in other situations, the fulfillment of one party’s wishes may come entirely at the expense of the other party’s.

Therefore, negotiation is the process of navigating your way through each of these alternatives, ideally aiming to come to an agreement that is complimentary to both parties’ needs.

Possible outcomes

There are five possible outcomes of negotiation:

  1. Compete = Win:Lose
  2. Avoid = Lose:Lose
  3. Accommodate = Lose:Win
  4. Compromise = neutral
  5. Collaborate = Win:Win

In my experience when I negotiate I aim for #5 and get either #5 or #4. I know that I do not want #’s 1-3 to happen. However too often I see sales people end up with #’s 2 or 3. This is no good for anyone and can train clients to expect things they do not deserve like unnecessary discounts.

Rule of thumb for negotiation in sales:

  • Unless you have the power or authority to change or modify terms, create new product solutions, you cannot negotiate.
  • Negotiation should never be a substitute for selling. You need to be able to sell well first and foremost.
  • Negotiation is an effective strategic tool that you use ONLY when you need it.
  • The earlier you give away concessions in the sales process the less impact they will have.
  • Be aware of giving sales people the authority to discount. All too often this is a licence to give away your margins too soon and too often. We see this when people ‘cave in’ on price too soon for fear having to deal with potential conflict which usually doesn’t eventuate if the sale is done effectively. However they never let the sale run its course to find out.
  • Discounting is a negotiation tool that should only be applied as a last resort and should have a trade off in it for your business so can you benefit from the deal as well. This is different from volume pricing which rewards people for buying bulk from you.
  • If you postpone tough negotiations whenever possible you will miss learning about new things, getting new ideas, new ways of pulling your offer together as well as creating potential conflict down the track.

You sell when you:

  • Identify clients’ real needs and priorities, create viable solutions that are of value to the client and outweigh the cost of purchase and gain agreement to move forward to close the deal and do the work.
  • Can’t vary the terms. If you can’t vary terms and negotiate and the client won’t agree to move forward with you on the current plan then it is a ‘no sale’. Move on rather than give it away. Giving it away is not negotiating it is just giving something of value away which costs you.

You negotiate when you:

  • Both parties can vary the terms
  • Resources are scarce
  • Agreement and conflict exit simultaneously

Value versus Cost

To help you avoid unnecessary negotiations when selling first of all find out what people really value and what is most important to them.

If you and your sales people are having trouble doing this then you need to improve your and your sales teams’ ability to have quality business discussions with clients and prospects, in particular, their ability to thoroughly understand their customers priorities and business needs and how your products and service can be crafted into relevant solutions that will address specific requirements and create value for the client.

This would include developing their questioning, creative problem solving, up selling/cross selling and solution selling skills.

Effective negotiation in a sales situation requires people being able to:

  • Be Assertive
  • Challenge every assertion
  • Get the real facts before offering up anything
  • Uncover real needs and issues
  • Negotiate late and negotiate little
  • Manage conflict and not take it personally
  • Analyse the situation and the demands and weigh them up appropriately
  • Keep the customers’ needs in mind at all times as well as your own
  • Aim high
  • Respond to demands for concession
  • Develop a proposal with guide-lines and trade-offs (if necessary)
  • Prevent the customer from ‘fragmenting’ your proposal
  • Present a total proposal that ‘adds up’ to a win/win solution
  • Focus on achieving satisfaction for both parties
  • Don’t make the 1st move
  • Don’t’ accept the 1st offer
  • Are willing to walk away
  • Use all their most effective communication skills (listening, paraphrasing, questioning, problem solving, etc.)
  • Apply a process
  • Don’t avoid negotiations
  • Have a ‘negotiation consciousness’

When do you need to negotiate instead of sell?

  • When a client demands an arrangement which is different from what you are able to offer
  • When you are dealing with a tough client who wants to ‘win’
  • When a client and you disagree on some aspect of the proposal
  • When the client will not agree to your initial offer (find out why because some people just like to win and want to bargain as part of the process. This is quite common is some cultures as part of the ritual of the sale)
  • When we are unable to reach agreement, even after many discussions
  • When you can’t move forward unless you change your approach some way
  • When you can’t deliver from you current suite of resources or you need to step outside of what you normally do to win the business (take care as this can be very costly)

I hope this helps put some perspective to selling and negotiation.

Remember everybody lives by selling something.

Presenting – Marie Perrotta From the Pegasus Community Project – Reaching for the Stars

One person I had heard a lot about from different sources while searching for interview candidates about Toronto’s Beach neighbourhood is Marie Perrotta, the Founding Director of the Pegasus Community Project for Adults with Special Needs. This non-profit charitable organization provides daytime opportunities for adults with developmental challenges, family support and community outreach. Pegasus also runs a thrift store whose revenues support the operational funding needs of this organization and provide practical work experiences for program participants.

Just before 10 am this morning I went to meet Marie at the Beaches Community Centre which is the location for one of her program groups. A few minutes before Marie’s arrival I had a chance to sit down for a few minutes with Gillian Story who is now a full-time program counsellor with the program. Gillian explained that the Pegasus program consists of three groups of adults with special needs that meet at three different locations: the Beaches Community Centre, Centre 55 and the Matty Eckler Community Centre, all in Toronto’s east end. Since graduating with a degree in music and psychology at Concordia Gillian started working at Pegasus in October of 2006 and admits it was a big learning experience at first. But she says that the staff and the participants in the program have been extremely welcoming and made it easy for her to fit in.

As Marie arrived and took off her coat to get ready for an interview, one program participant, a 24-year old woman named Shannon sat down beside me. The group was very cheerful and demonstrated a very natural sense of curiosity. A couple of the participants had peppered me with questions as to who I was, why I was here and what I was planning to do, and I briefly explained my interview plans. Shannon mentioned that she works at the Pegasus Thrift Store twice a week and volunteers there on Saturdays as well. She operates the cash register and welcomes the customers. Marie confirmed that Shannon has a great talent working with people and referred to her as a “natural social worker”. On Mondays Shannon goes to Variety Village, a fitness and life skills facility in Toronto’s east end, where she and her friends from Pegasus enjoy swimming, weight-lifting and other physical activities. Shannon was very gregarious and outgoing and inquired whether they might be a possibility to see her later at the Pegasus Thrift Store.

I did not want to let Marie wait any longer, so I thanked Shannon for talking with me, and Marie and I relocated in order to be able to do a quiet interview. Marie is originally from Buffalo, and she and her husband moved to Ontario to complete their graduate degrees here. After her undergraduate degree in French literature she completed her graduate studies in assessment counseling at the Institute of Child Studies at the University of Toronto. Her work background prior to her involvement with Pegasus includes psychiatric research at the Hospital for Sick Children.

One of Canada’s attributes that captured Marie right from the start was people’s openness, the country’s civility, diversity and tolerance. Marie noticed these characteristics right away and added that tolerance is underrated. In her words, if you spend enough time with people who are different, with time you’ll get over those differences. I wholeheartedly agreed with her and we concluded that often it is lack of exposure to people of different backgrounds that creates negative stereotypes.

Marie has three children: Andrew, 34, an adult with developmental challenges, Olivia, who just graduated from international development and science at McGill University in Montreal, and Cristina, who at 17 years of age is still attending high school. As the mother of a child with a developmental disability Marie understands the unique pressures of families dealing with developmental challenges. In 1993 Marie found out that adult children with developmental handicaps would not have access to day programs after the age of 21. About 650 people in Toronto were on waiting lists for existing day programs and Marie knew she had to do something.

Marie got several parents together that were in similar situations, but the group did not last long. She called on government funding agencies and approached the Matty Eckler Community Centre, part of the Toronto Parks and Recreation Department. The representatives at the community centre reacted extremely positively and offered Marie some space for her intended day-time program. Once she had secured the location, she formally set up a charitable organization and put together a board of directors which included another parent with a developmentally challenged child, as well as three other board members, including a teacher, a child daycare administrator and an occupational therapist.

From January to September of 1994 the team raised $30,000. Alison Masters, one of the Board members, held a big auction and a party at Lido’s Restaurant. With another fundraising event and a small grant from the city the program was ready to start. One of the earliest exercises was to find a name for the organization, and Marie came up with the idea to draw on Greek mythology. In the spring of 1994 they had set a goal to get the organization launched by the fall, so she decided to pick a fall sky constellation and came up with the name Pegasus. The organization indeed got its start in September of 1994. Today many other names of heavenly objects are used in the fundraising efforts of the organization: The “Galaxy of Stars” lists donors in different categories including “Hercules”, “Perseus”, “Cygnus” and “Lyra”. Another group of donors is referred to as the “Meteors”.

Over the years funding has come from many different sources. For ten years Marie ran an annual yard sale from her front yard and as the handling and storage of donated goods became too onerous, fundraising efforts have now shifted to the “Pegasus Thrift Store”, located at 970 ½ Kingston Road. The store is an interesting project because not only does it provide significant funding for Pegasus, it also offers practical training and work opportunities for many of the participants in the Pegasus program.

Until 2000 Marie ran the program out of her house and recalls that acquainting herself with the necessary computer skills initially presented a challenge. In the beginning, when her daughter was only 4 years old, Marie had trained her to take telephone messages. So one day a call from the Association of Community Living came in and Cristina politely asked the caller to spell out the name of the association. When Marie had a look at the message Cristina took, she saw a big note, all scribbled out across the whole sheet of paper in a 4 year old’s handwriting, but with a perfectly proper spelling of the organization’s long name.

Today, the Pegasus Community project receives significant funding from the Ontario Ministry of Community and Social Services, and a program fee has been implemented. Marie indicated that the government support has been tremendously helpful in light of the enormous financial and psychological strain on families with a person who is suffering from developmental handicaps, which include such disabilities as Down’s Syndrome, autism, certain cases of cerebral palsy and others. Marie added that many cases of developmental handicaps do not have an exact diagnosis.

The program is very staff intensive: the ratio of staff members to program participants is 1 to 2.5. Some of the participants require care to meet their physical needs. Staff also look after some medical needs, such as seizure monitoring, giving medications, and feeding through a G-tube. All of the staff members and volunteers in the program receive the requisite training to be able to provide proper care to the participants. Marie indicates that today virtually all of her staff members have two or more years of post-secondary education and many have university degrees and related experience.

The Pegasus Community Program today has 38 participants located in three community centres. Two types of programs serve the participants: the Aquarius Program offers long term support while the Pegasus Program is a transitional program which focuses on skills development and vocational experiences.

Marie strongly believes in a decentralized approach since it allows for greater integration into and acceptance by the community. Other facilities often house the same or an even greater number of participants in one location, but often these locations are in industrial areas, isolated from residential communities.

Marie is a strong proponent of community integration, and she feels that virtually every human being, including people with developmental disabilities, have the capability to give back to the community. The Pegasus participants volunteer at the Thrift Store, they also take on unpaid volunteer work assignments in the local community at stores such as Price Chopper and Zellers, and they volunteer to deliver a local community newspaper, the Beach Metro News.

Viewed from the perspective of a person with disabilities, community interaction and integration is absolutely critical. Every human being needs a change of scenery as well as mental and sensory stimulation. One day when her son was not able to attend the Pegasus program, he was sitting in the kitchen, sadly staring at the door. Although he was not able to vocalize his feelings, Marie recognized very clearly that he deeply missed being able to go out and join his friends at the program. She added that when you work with people with disabilities you get very good at paying attention to decoding non-verbal communication.

Volunteers are an absolutely critical element in Pegasus’ success. Marie refers to some of her regular volunteers who come out to work with the participants: Margaret Simmons, a retired principal, comes in regularly to provide a literacy program while Selma Smith has been teaching an arts and crafts program for five years. The projects of the “studio program” are quite sophisticated and the artistic products are sold at the Thrift Store as well as by local retailers in the Beach such as Arts on Queen.

Three students from the Behavioural Technology Program at George Brown College are currently completing internships with the program while six nurses from Centennial and Humber College are completing practical community nursing placements for their Bachelor of Science Degrees. A high school student named Kelly, from a community program at Inglenook High school is also currently volunteering with the program.

The Beach community has widely supported the program, and the participants regularly venture out into the community in different excursions. Today as I was there, several people arrived with shopping bags full of groceries, and collectively the group prepared a delicious and nutritious lunch that included chicken wraps and sweet potato fries. Marie also indicated that fitness and physical activities are an important component of the program. Participants regular go to Variety Village to go swimming and play team sports such as soccer and basketball. Marie added that there are quite a few gifted athletes in her groups.

Some of the participants have fewer support needs than others, and with several years of assistance and support they may even move on to holding paid jobs in the community. The young lady Shannon who I was talking to earlier was a good example of this and she has successfully and enthusiastically been working at the Thrift Store. Marie believes in all sorts of possibilities for her participants and the program provides job coaching for the participants who have the potential for gainful employment. Other practical skills such as learning how to take public transit are also taught in the program. Marie adds that this type of training does take years, but it is an important investment in individuals and the community as a whole.

Currently Marie is working on organizing a fourth group which will be run out of SH Armstrong Community Centre just a bit west of the Beach neighbourhood near Coxwell. Marie firmly believes that the decentralized approach is critical for the success of her program since it provides for greater community interaction and acceptance. She adds, maybe a future successor of hers might make changes to that approach, but for now she is happy that she now has a program manager who is very familiar with the program’s philosophy. She is relieved that even if she were not around, the program would continue.

Running a registered charity comes with all sorts of challenges, including a wide range of administrative duties as well as quarterly financial reports and budgets. Marie indicates that although Pegasus is a small organization you have to deal with the same organizational issues as in a large organization. But once you get it under your belt it becomes much more manageable.

Several merchants and organizations also support the Pegasus Community Project. Residents in the Beach have welcomed the program and Marie adds that Beachers are more broad-minded and charitable than they are sometimes given credit for. Some people have even thanked her for bringing developmentally challenged individuals into the Beach. Just recently one individual wrote a $500 cheque to the project, and he was so happy to do so as if he had just been waiting to be asked to write that cheque. The generosity from so many people is outstanding, and Marie really appreciates all the support she has received.

One organization that has been particularly helpful is the Toronto Beach Rotary Club which supports Pegasus with regular fundraising initiatives. Local merchant Harold Wisefeld, also known as Zoltzz, the owner of the famous fashion discount store Ends in the Beach, has been a very generous contributor to Pegasus. Another local entrepreneur, Dan MacLeod from the Price Chopper supermarket at Gerrard and Victoria Park, is extremely committed to community work.

Marie says he has opened his store’s doors to hire many people with disabilities. He will even assign regular employees to work alongside a person with a disability, to train them and help them. One of Pegasus’ participants, a young man named AJ, works at Price Chopper three days a week and needs coaching while he is there. Dan sees to it that he receives the support he needs. Dan also supports many of Pegasus’ special events as well as other organizations such as the Cancer Society and the Alzheimers Society. Very few merchants would go to these lengths to accommodate and support people with disabilities.

After having concluded our one-on-one interview we checked in on the Phoenix group next door which in the meantime had prepared lunch and was enjoying a good meal around the table. After a few photos I said goodbye to the group, thanked them for their time and interest and invited them to join me for my Photo Exhibition in the Beach which will be held in early March. Fortunately the location will be within walking distance and the members of the group will be able to drop by and have a look at the photos.

Marie and I then drove five minutes up to Kingston Road where Marie showed me the Pegasus Thrift Store. The store is open on most days, but it is better to call ahead to make sure that the store is staffed. The Thrift Store sells everything from used books, CDs, fabric, clothing, dishes and glassware to small electric appliances and even Barbie dolls. It provides a great opportunity for Pegasus program participants to gain practical work experience and support the fundraising efforts for their program. Friends and neighbours donate all the second-hand goods that are sold in the store.

For me the highlight of the store are the products that are made by the Pegasus program participants themselves. Marie demonstrated a range of hand-made products to me:

- handmade greeting cards featuring feathers and a variety of artistic techniques
- bookmarks reminiscent of beaded necklaces
- soup mixes including recipes
- various types of cookie mixes
- the most recent addition to the merchandise: a handmade tote bag made from donated fabric

In addition to her regular duties Marie works in the store virtually every Saturday and hopes to be able to find some help in organizing it soon. She added that initially her plans were only to cover the costs of the rent and telephone, but the Pegasus Thrift Store has morphed into much more than that: a major fundraising tool as well as a great place of learning for her program participants. Many shoppers say it’s one of the most fun places to shop at in the Beach.

I also asked Marie whether her organization has a website yet and she indicated not yet. But she is currently working with two volunteers to develop one.

Meeting Marie Perrotta was one of those humbling moments when you get to know someone who has overcome significant personal hurdles and truly dedicated her life to people in need in the community. Several awards recognize these efforts: Pegasus won the 1995 City of Toronto Access Award and the 1998 Innovation Award. Marie herself was honoured as the 2004 Beach Citizen of the Year, following the footsteps of other prominent Beachers such as Gene Domagala (who is also a regular volunteer for Pegasus), Glenn Cochrane and Arie Nerman.

As I walked away from the store I thought the heavenly analogies of the Pegasus Project are quite fitting: to her program participants Marie must be like an angel, sent down to earth to help them reach for the stars.

For more information about the Pegasus Community Project or to make a donation please contact Marie Perrotta at 416-691-5651. To contact the store regarding shopping or dropping off donations, please call 416-913-2544.

Learn to Negotiate

People negotiate everyday. The art of negotiating is part of life. People start negotiating since they are small. Every decision taken as long as some else is involved is a negotiation. People negotiate because they need something, so it is important to learn how to negotiate properly and how not to get the other person upset. In the business world the difference between winning and losing has to do with the way business people negotiate.

Negotiating is placing a request not a demand. When business people demand something they might get it at that moment, but it will certainly come back with an unreasonable demand from the other party. Learn to request and you will notice how your negotiating skills improve.

Negotiating is learning to listen. Businessmen have to attempt to understand the other party and find out what they need and what their expectations are. When negotiating listen and do not interrupt, and most important understand what is being said. Telling people what to do will eventually have a payback: people will do what ever they want and not listen to you as well.

Before negotiating it is very important that you understand what you need. If you do not understand your needs you cannot request others to do something. When you understand what you need and not what you want, you will certainly have an advantage for you in the negotiating process.

Do start negotiating if you are angry. When you are angry you loose. When you are angry you might not even know what you need, so it is very unlikely that your needs will be met. Anger reduces your ability to think clearly and your reasoning skills.

As mentioned before it is important to listen. When you listen properly you will understand the needs of the other party. When you understand your needs and the needs of the other party then you have a huge advantage in the negotiating process.

During the negotiation it is important to be calm, show interest and show empathy. Be prepare to ask question, when you do you will in turn receive answers and will better understand the issues involved.

Place yourself in the chair of the other person. When you do so you will better understand what is going on, you will ask the right questions and most important you will get their cooperation.

Be interested in the person and in their concerns. When you are really interested it is easier to listen, you will understand them better and in turn will come out with an effective negotiation.

It is very easy and simple to negotiate, as long as you make a conscious effort and follow the points mentioned above you will be able to fulfill your needs and come ahead in the process.