As one of the world’s most innovative sales playbook solutions, we are constantly on the lookout for other innovative thought leaders and educators. Mark Raffan, negotiation coach, speaker, and host of the Negotiations Ninja Podcast, is certainly an innovator. After starting a career in ad sales, Mark worked on the procurement side for a while leading teams at various companies before starting out on his own.
As he progressed, he quickly realized there were no resources available that focused solely on B2B negotiation between sales teams and procurement teams. After a friendly dare (over a few pints, no less) put the bug in his mind, Mark started the Negotiations Ninja Podcast and quickly became the foremost leader in sales negotiation education.
Today, Mark splits his time between working with both procurement teams and sales teams, focusing on hands-on education and training. It’s all about the negotiations that take place.
“I really don’t teach a procurement process or a sales process,” Mark explained. “I focus more on the negotiation that exists within those processes and how sales teams can get better value from the deals they’re currently working on.”
Don’t let internal processes slow you down
In Mark’s experience, the biggest mistakes that sales reps can make in the procurement negotiation process is linking value to timelines. In the SaaS industry especially, reps tend to become too reliant on timelines (such as end-of-year, end-of-quarter, or end-of-fiscal calendar) and they allow these timelines to influence their concession points in a negotiation.
“Sales professionals spend so much time and effort building up the value of their solution,” Mark said. “But in the end, they simply throw that work away because of a self imposed timeline. Sales people are often incentivized on these timeline-based results, it’s a process error, not a sales error.”
The best way around this mistake is to have a massive pipeline in place. This way, a sales professional can walk away from a deal on the basis of time without worrying about not hitting a goal. This is their biggest point of leverage. Oftentimes, professional buyers and procurement teams know that they’re going to be pressured at the end of the month, so they’ll simply wait a deal out. Instead of conceding the deal based on timeline, a competent sales rep can use his or her pipeline as leverage and stay in the negotiation – no matter what.
Unfortunately, negotiations as a whole are one of the most common places for sales professionals to lose steam during the sales cycle. In Mark’s eyes, this is all because of predetermined conditioning.
“As a procurement person, I’m constantly trying to change the perception of the entire sales cycle,” Mark said. “Think of it this way: the procurement side is constantly trying to raise the perceived value of the buyer (‘we can be choosy because all the vendors want to work with us’), lower the perceived value of the seller (making the seller seem desperate and needy to make the sale), and raise the perception of competition (highlighting the ‘other fish in the sea’ the buyer can go to if the sale falls through).”
This ‘psychological warfare’ of sorts between procurement and sales often comes as a surprise to sales professionals because, sadly, sales doesn’t always put the amount of prep work into deals as they should. Procurement teams know that closing deals is critically important for most sales reps – more important than it should be – because they don’t have other deals to fall back on.
“This is when sales teams start hearing phrases like ‘You’d be lucky to get any work from us whatsoever’ or ‘We can have our pick of vendors like you’,” explained Mark. “And this is when salespeople start believing these alternatives and giving up certain negotiating factors.”
Best practices for strong sales negotiations
At their core, sales and procurement focus on two different sides of the same coin. While sales culture focuses on closing a deal, procurement culture focuses on the individual deal itself. For a sales professional to truly become a great negotiator, they can’t try to rush the deal and they must ask the right questions.
“If your team involves procurement early in the sales cycle, understands exactly what they want, and delivers what they asked for, you’ll have in place a fail-proof process,” Mark said.
Basically, procurement teams have a ton of processes on their end, and the best sales reps understand that there isn’t any way to force a deal closed. Sales isn’t just about selling to the end user, it’s about selling to multiple stakeholders with multiple needs. It requires empathy and patience.
In order to be empathic, you need to understand the other party. Mark recommends utilizing the question-funnel method, starting with open-ended questions and narrowing it down to more detailed, focused questions.
Some open-ended questions to start with include:
- What are the challenges you’re facing?
- What problems are you seeing with your current vendor?
- How’s this relationship going?
- Have they delivered value?
- How do you view value?
- What do you expect from your vendors?
- What are your KPIs?
Coaching and leading better negotiators
For sales leaders, proactively coaching and leading a strong negotiating sales team is hard, but it’s not impossible. One of the most important starting points is, in fact, role playing.
“Many sales professionals go into negotiations without any preparation or any role-playing experience,” said Mark. “They don’t know what questions to ask, when to ask them, or even why they want to ask them. Effective negotiators know what response they’re looking for before they even ask a question.”
For best results, sales leaders should implement a rigorous role-playing training program that allows sales reps to practice these negotiation conversations, come up with strong, focused questions, practice tone and inflection, and determine what to do in different situations. This way, in an actual negotiation, there won’t be any surprises.
Further learning opportunities
For sales teams looking to become better negotiators and work more efficiently with procurement, Mark has three main pieces of advice:
1. Slow down! The sales process shouldn’t be forced. Don’t link concessions to a timeline, link them to product value.
2. Ask questions! Sales professionals should consider themselves investigators. Dig deep to uncover the problem your solution is being asked to solve, and why this problem is occurring in the first place.
3. Listen to others! Sales reps are active creatures, but during a negotiation, it’s important to be present in the situation and take detailed notes. If something doesn’t make sense, go back and clarify.
Another thing that many sales reps have trouble with is silence. Sales reps hate silence, which has made it a weapon for procurement teams. Mark’s biggest advice is to get comfortable with silence and awkward situations.
“One tip I tell my negotiation students is to go to a coffee shop or grocery store and ask for a deal or discount without any preamble,” Mark said. “Practice standing there in silence, with a straight face, as the person weighs your request. Don’t shift or smile or look sheepish. Remain confident and silent for as long as it takes.”
The more comfortable one is with silence, the better you’ll be able to deal with it in real life during an actual negotiation.
For continued education, Mark recommends extensive reading
“Don’t rely solely on ‘learning on the job’,” Mark said. “All people in any industry must read to improve their skills, and then take it a step further by putting this new knowledge into action. Some of my favorites are anything by Jeb Blount and Anthony Iannarino, the books Never Split the Difference and The Art of Power Negotiating, and of course, my podcast, Negotiations Ninja.”
Ready to Learn More?
For more information on best practices of great sales leaders, check out the Costello resources below. If you’d like to see Costello in action, request a personalized demo of our real-time sales playbook software.