Very often in the IT world, you find yourself going to a vendor or service provider to negotiate a contract. Both parties are coming in with expectations and hopes for the outcome but neither can predict what the final contract will look like.
If this scenario is in your future, you better be prepared. If your negotiation skills are sub-par, the outcome will not be in your favor. Here are 8 tips to sharpen your contract negotiation skills.
BEFORE THE MEETING
1. Know when to say no
Draft out the ideal contract in your favor. Put in all the flourishes and accessories that you feel will make it absolutely perfect for you. Then one by one, think about what you are willing to let go of. Start with the outermost shell, the add-ons that you don’t need, then work your way down from there. When you find that you can no longer sacrifice anything, you will have a clear idea of what your bottom line is.
It’s absolutely vital that you do so. Understanding your bottom line will help you determine with things have gone too far and you will be able to know where to draw the line.
2. Come prepared
Learn as much as you can about the wants and needs of your company and the wants and needs of the vendor you are negotiating with. The more you know, the less likely you will be fooled, and the better you will be able to reach a compromise that makes both parties happy.
Preparation is key. If you are sure of all of the above information, you will know how far to go and how far to allow the vendor to go.
3. Establish a Plan B
What happens if things go awry and you’re not happy with the contract? You need to have a fall-back plan or else you’ll be forced to strike an unsuccessful deal. Make sure your Plan B is clear to you and aligns with points 1 and 2.
DURING THE MEETING
4. Temper tantrums don’t get results
The most important thing to remember during a contract negotiation meeting is that this is not an argument it’s a discussion. Whenever you feel the tensions rising, fall back, have a cup of Joe, take a breather, then continue. Arguments result in unnecessary stubbornness and are not in the favor of anyone.
5. Speak
A negotiation is not a one-man job and you can’t let the vendor do all the talking. Whenever you have a point to raise, raise it. Never be afraid of asking questions. Make sure that you get a chance to ask for everything you want and point out the things that you don’t want. The most explicit you are, the clearer your demands will be.
6. Listen
On the other hand, you can’t do all the talking either. You must remember to listen to the vendor and have an open line of communication. Be an active listener, observe body language and pay attention to details. Take down notes if you have to.
Being this attentive will help you learn things that might further your interests. You’ll be able to ask better questions and have a more productive conversation. Be willing to brainstorm and explore options. Remember that the vendor is not your enemy, they’re your ally.
AFTER THE MEETING
7. Get it in writing
Written agreements make everyone’s lives easier. They are written proof of what has been agreed on. You can base all legal matters on the contract in the case of a dispute or a change of staff.
8. Never sign anything you haven’t read or agreed on
When you receive the contract, make sure you read the fine print to be 100% sure that this is the contract you agreed on. If you find an anomaly, point it out before you sign. Repeat this process as many times as necessary until you are sure that the final form is aligned with the original agreement. Don’t be shy about asking about things you don’t understand.
Do you have any more tips that we missed? Share them with us in the comments section below.
