The value of any product or service is determined by the market; both buyer and seller have a role in determining value. As sales professionals, we must be careful not to abdicate our role in establishing the value of our goods and services, and be ever mindful that effective negotiations is not about winning or losing; it is about finding solutions for BOTH parties. And that is precisely why we should always pursue quid pro quo versus concessions in every negotiation.
What makes concessions so detrimental? Giving something away without getting something of value in return essentially communicates to your negotiating counterpart that what you gave or conceded to them is of little or no value. As a negotiator, you’ve lost something without gaining anything – including appreciation for what you’ve just given away! Concessions create a double hit to your negotiations efforts.
Taking a quid pro quo approach to negotiations reflects the pursuit of fairness, thereby appealing to the customer’s sense of fairness. There are many positive connotations associated with the concept of “fairness,” most notably ethics, which are reassuring to all involved in the negotiations process. Because the notion of quid pro quo is the very essence of a win-win outcome, it gives permission to you as the sales professional to seek equal benefit from the deal – not out of a sense of greed, but out of a sense of fairness.
Prior to any negotiation, you should identify and prioritize your needs and objectives, including the benefits you envision for the customer. This thought process will better prepare you to align your and your customer’s goals and also provide context when negotiations begin and the customer articulates demands. As was referenced previously, effective negotiations is about more than the deal at hand. The manner in which we negotiate will have profound implications on the long-term health of each customer relationship, as well as our long-term profitability at that account.