So as promised here is the remaining list of negotiation tips.
Boat Broker negotiation tips
21) Making sure the customer understands the context:
If arguing for one percent or two prevents them from making millions in profitability, remind them of the silliness of wasting time to achieve these goals.
22) The FLINCH:
Say something like, “Wow! That’s ALOT of money!” + SILENCE
“Wow!” or “WHAT!” + SILENCE
23) Mention that your product isn’t cheap or that they will find cheaper products out there:
Begin establishing your position early in the conversation. The ‘Challenger Sale’ talked about creating constructive tension and discussing price early as two of the most powerful things that Challengers did naturally. I like it because it displays transparency and confidence.
24) Stop being obsessed with pricing:
Remember that only 1% want a great price. 90% want great value. Stop being obsessed by pricing and start focusing on the value.
25) Body language:
Recognizing a person’s posture and body language will help you a lot during a negotiation.
Signs of discomfort during the conversation might be:
Fidgeting, itching, ticking, tapping, scratching or gesturing, aversion of eye contact, shaking head, folded arms (closed off), shaking of head (subconscious, shaking their head no).
On the other hand, signs of interest might be:
Leaning in, nodding, smiling and keeping good eye contact, an open torso, legs pointed towards the person.
26) Negotiating by phone:
Phone communication makes negotiations more difficult because you cannot read their body language.
- Pay attention to voices – both theirs and yours.
- Keep your tone cheerful, warm, steady, and confident.
- If they take long pauses after your points – they are most likely hesitant to agree.
- If they speak in a lower tone of voice – they could be hesitating to agree.
- If they respond quickly and with a higher tone – they are interested and engaged, responding positively.
Write all the important things so you won't forget any vital info, i.e. commitments you have made.
27) Negotiating by text/email:
What’s the first thing people look at when going to bed and waking up the next day? Their cell phone. Always try to get your prospects’ cell phone numbers and text them. Texting to cell phones has been proven to offer a 40% higher conversion rate.
More and more people like to negotiate by email or text. There are huge benefits to it. You can edit your responses – you can craft them perfectly and have more time to come up with a response than in person.
Remember that everything that’s written will be there forever, so be cautious of every word you use.
Try to establish a positive atmosphere and use positive words, try to be brief and don’t look desperate.
The issue is that your negotiation will be less personal, as it is much easier to say no to a computer than a person’s face.
28) Foot in the door & door in the face technique:
These negotiation techniques are based on anchoring a lower or higher price to influence the outcome of the negotiation.
The foot in the door: starting with a small commitment and then asking for more.
“Can I ask you a small question? Or “Would you like this free sample?”
The door in the face:
“Would you like to participate in our Run for the Cure race? It is $50 and it will start at 8am on Sunday. Would you like to sign up?”
“Sorry I am going to Church” or “Sorry I work so hard during the week I need to sleep.”
“Ok no problem, so what about a Sleep for the Cure donation? Only $5.”
Or the door-to-door cookie girl who asked for a $10k donation to the Red Cross (which was obviously refused) and then immediately asked them to buy a box of her cookies for $5.
29) Can we work on that?
By using the word "we," you've asked the other party to partner with you in coming up with more acceptable terms.
30) Is that the best you can do?
Inflation… + Silence
31) Can you do 2 for the price of 3?
I sometimes love using this obviously silly question to establish a friendly atmosphere when I am buying multiples items. I then proceed to a more serious request for a discount.
32) Never disagree with the client:
Always agree with the client, even if they are justifying themselves. For instance, if your prospect says: “This boat is beautiful, but we don’t need it,” don’t respond by trying to convince them on how much they need it.
Instead, respond with:
“I understand. People don’t buy this boat because they need it. They buy it because she is beautiful and makes them feel good!”
Do not use the classic “If I could, would you?” e.g. “If I could give you an extra 5% discount, would you buy the boat today?”
It shows that you assume the price is the only objection.
Saying this is just disagreeing with them and will not help you with your sales process.
33) Do not use a confrontational approach:
In a negotiation, you need to view your potential client as a partner rather than an opponent. Psychologically, this puts each party on the same side. It will bring more confidence and trust to both parties. Create an interactive environment based on an agreement rather than confrontation or bargaining.
Tell your client for instance "John, my objective is not to pressure you to sell you this boat, I am here to help you buy. If it is not the right boat for you, we can look into another model."
If the potential client is not willing to come to an agreement, you might have to consider stepping away from the sale. What often happens then is the potential customer reconsiders their offer and returns to negotiating with a higher level of respect for your offer but also the relationship.
34) Help me out here:
“Hey John, we have to work together and you have to help me out here.”
35) Let's do better than that! EVEN MORE SILENCE
Notice the difference between “Is that the best you can do?” and “Can you do better than that?”
They are seven harmless (but powerful) words! They'll cause no embarrassment, you'll feel no pain, and you'll likely end up saving a bundle.
36) The double negotiation:
Buyer: “Would you take $25,350 for it?” + Silence
Buyer: “Hmmm…” (Another long pause). “Well, I am still not sure I really want this engine configuration so I’ll tell you what. I’ll give you $24.250 and it’s yours? Deal?”
37) Ask small to get big:
If you want to buy the most expensive model, show initial interest for the cheapest one. You will have more room to negotiate as you can anchor the price to their cheaper product and show them that you are making a huge effort by buying the more expensive product.
38) Try to be the first one to establish your position:
Whoever starts the negotiation sets the tone of it. It is better to ask for your position first and justify it with measured discounts than to let them start by asking for their position and allowing them to set the amount of the discount.
39) The questioning technique:
Imagine you want somebody to come to your dealership event next weekend. Don’t ask the question, “Would you like to come to my dealership event next weekend?” But start with this question instead, “Do you have any plans for next weekend?” They will usually respond by “No, why?” Then proceed with your invitation.
40) The personality type:
Here is the ratio of each personality type in the US:
75% are feeling and right brain based
25% are ego logic and left-brain based
If you want to enhance your relationship with others, you should be genuinely interested in them. People will open up to you and feel more comfortable around you if you are able to ‘click’ with their personality.
When it comes to understanding each other to improve sales, you can apply some basic best practices, like the "I think" vs. "I feel."
“John, out of the two boat models I have shown you today, which do you think is best suited for you?”
“John, out of the two boat models I have shown you today, which do you feel is best suited for you?”
Asking a customer what they ‘think’ will subconsciously make them rationalize their choice in terms of logic, and may not reveal what they truly prefer, or most importantly, why they prefer it.
Asking what they ‘feel’ invites them to share their feelings and their emotions… Sales are based on emotions, rather than logic, so in certain situations, the feeling option will always be a preferred one.
41) Fair & firm:
If you are not in a position to negotiate, make sure to state it before. Tell them, “Our prices are fair and firm.”
42) The precise counter offer:
When you’re proposing a counter offer to the other party, do not make it a round number. For instance, if the boat is for sale at $45800 and you want to make a counter offer, do not say $43000, say $42,855. It will show the other party that you have done your homework and have a valid reason to reduce the price so your offer might have a higher chance of being accepted.
43) The ABC formula
When discussing pricing for a new listing with a client (which is often a very sensitive conversation) you can offer multiple price alternatives.
“Ok John, I think we can help you sell this boat. I would like to give you 3 options: Price A if you are looking to sell the boat immediately. Price B we should receive some inquiries but it will take a bit longer to sell. Price C we might get inquiries but it will be a long process and no guaranty of sales in this actual market. Which option would you like to choose?”
44) Enhance the value of your product:
One of my friends and broker, Baggy Sartape, likes to compare the yachts he sells to other luxury items like jewelry, real estate, luxury cars or even planes. The right choice of metaphors can help you enhance the perceived value of your offering. Investing in a yacht by comparing the accommodation to a house, a transportation vehicle like a car, or the complexity of a navigation system like an aircraft, emphasizing the safety of operation and redundancy of systems to avoid break downs on the open sea.
45) I will agree to this price if you….
The last part of the negotiation is always the easiest. Use it to always get something to your advantage: Say something like, “Okay, I’ll agree to this price if you will throw the dinghy in for free.”
46) The volume purchase:
Here is the typical scenario when a customer considers a volume purchase. They buy one and ask you for a huge discount by promising you multiple purchases in the future (that they rarely fulfill).
Instead of falling into the volume purchase trap, use this instead: “Look, buy the first one at regular price so it shows me that you are serious and committed. If you like it and it is a good fit, then we will make sure to give you our best price for your future purchases, does that seem fair?”
47) The walk away technique:
The closer you become to the final agreement, the more emotionally involved you will be. Do not become so emotionally involved that you cannot walk away. This can really be used as a powerful tactic, only if you are prepared to walk away.
The highball/lowball tactic is one of the oldest negotiation techniques. The other party will open with an extremely high or low offer, which they hope will force you to reconsider your position and give up more negotiating power.
49) The agenda technique:
Agreeing to an agenda might be the best initiative you could do to win a negotiation. You want to put yourself in a position of authority (alpha). Always establish an agenda that benefits both parties. People like structure and it will help you during your negotiation.
For instance say: “Ok John, so here is what we are going to do. We will review the terms of the quote one by one. I will ask you a couple of questions which I expect you to respond to honestly so I can make sure I perfectly understand what it is you want. You can also ask me questions which I will respond to honestly, so we will be able to see if our boat is a good fit for you and we can then agree on the agreement. Does that seem fair?”
Hope that you enjoyed those boat broker negotiation tips! Don't forget to also check part 1 of this blog: What every boat broker should know about negotiation.