Article | 12 min read

Sales negotiation skills and strategies to win more deals

Sales negotiations can be delicate. Learn how to set your sales team up for success with key strategies and training.

By Donny Kelwig, Contributing Writer

Published November 2, 2022
Last updated November 2, 2022

Friday night is approaching. The local drive-in (remember those?) has a killer lineup of double features. You text your S.O., “Check out Screen 1! We have to go!” Their reply isn’t quite what you hoped: “Not interested. Screen 2 or bust.”

Looks like it’s time to begin negotiations. Are you prepared?

Life in sales isn’t so different from navigating the delicate conversation of movie preferences with your partner. There are real benefits to be had from honing your diplomatic skills and establishing a set strategy for guiding leads from the top of the sales funnel to the bottom. Companies with no formal negotiation process in place show a 63.3 percent decrease in net income, leaving a lot of cash on the table.

In this guide, we’ll cover what a sales negotiation is, why it’s crucial to have a clear negotiation strategy and tactics, and which skills your team should start honing now.

What is a sales negotiation?

A sales negotiation is a discussion between a buyer and seller, ideally leading to a mutually agreeable deal. It often entails some back-and-forth conversations involving buyer concerns, concessions, established value, and compromise. While the goal of any sales negotiation is conversion, unfortunately, a negotiation won’t always lead to a sale. Sometimes, buyers and sellers don’t agree on the terms and are forced to part ways.

Why is negotiation important in sales?

Without negotiation, buyers and sellers might never arrive at satisfactory deals. Clear communication builds positive relationships between buyers and sellers and helps determine prices and outcomes. It can also prevent misunderstandings, conflict, and frustration for both parties.

Negotiation is important in the long and short term. When salespeople are honest, empathetic, and composed, they earn buyer trust and respect for future sales and referrals. This is invaluable for a sales team and a brand, so it’s crucial to give negotiations the utmost care and attention through every follow-up step.

Essential sales negotiation skills

Whether you’re in B2C or B2B sales, any rep worth their salt needs to cultivate certain negotiation and communication skills. While there’s a lot of know-how that goes into closing deals, we’re highlighting four particular skills that are essential to successful sales negotiation.

Being prepared

Being prepared, writing in notepad

Careful preparation before negotiation matters if you’re going to close a deal. A killer sales strategy begins with knowing your product and your customer. Before you step into the room, try to ascertain what your buyer is likely to want and what you’re able to offer them. Why do they need your product or service? What are their pain points? What is their budget and what’s their role in the decision-making process? What are their other options if your deal doesn’t materialize?

In addition to knowing your qualified lead, acquaint yourself with your sales numbers, the products you’re trying to sell, and company policies. What concessions are you authorized to make? What is your best alternative to a negotiated agreement (BATNA)? Being able to answer these types of questions requires a great deal of thorough research.

Using active listening

Using active listening, speaking into microphone

In sales, as in life, it’s important to be a good listener. Sometimes, this means parsing for subtext. For example, if a prospect raises objections about cost, they might actually have concerns about something besides the price. The best way to discover their real concerns is to open up the conversation—and your ears.

By using active listening to uncover what the prospect is truly worried about, you can then address and alleviate their doubts. Even if the deal doesn’t ultimately come to fruition, you’ve shown your buyer respect by listening carefully. Anyone can appreciate that.

Handling objections

Handling objections, finger pointing

Handling objections is a skill that involves a mix of active listening, problem-solving, and preparation. Almost all objections can be countered with knowledge about your products, competitors, and prospects.

It’s also important to understand your buyer’s objections and underlying objectives. Help them see that you’re there to help them meet those goals, and guide the negotiation toward solution-oriented next steps. Look for opportunities to build value around your original offer, too.

Knowing when to walk away

Knowing when to walk away, peace sign

At first blush, it may be strange to see the words “walk away” on a list of negotiation skills for sales professionals. But being able to gauge when a deal is no longer worth pursuing is a key skill to master. Consider calling things off when a prospect:

  • Makes unreasonable demands or wants unprofitable concessions
  • Expresses needs that even your most lenient terms can’t accommodate
  • Resists collaboration and refuses to compromise

Occasionally, communicating your willingness to leave the table can push your buyer to reconsider. And if the deal doesn’t pan out, you may have just avoided a frustrating sales relationship.

Improve your sales process

A good sales process is the foundation of any successful sales organization. Learn how to improve your sales process and close more deals with this free guide.

7 sales negotiation strategies

Strategy isn’t just important on the battlefield or the chessboard. It’s a critical part of successful sales negotiations. Here are seven strategies for negotiating a winning deal that works for you and your buyer.

1. Lead negotiations

Rather than sitting back and waiting for a buyer to drive the conversation, take the lead. Set the agenda for your meetings. Be the first to share ideas, objectives, and concerns—and make offers.

This doesn’t mean setting aside your listening skills, though. After opening negotiations, be prepared to hear the buyer’s responses.

Leading isn’t about being overly eager or accommodating. It’s about starting with confidence and setting a strong tone.

2. Build value

Too often, sellers are tempted to cave when buyers raise objections. Don’t give in to that temptation. Instead, focus on the buyer’s objectives—why they’re asking for a concession or pushing back—and try to show how your product or service will help them achieve those objectives.

Maybe they have a big budget issue or they don’t see the full benefit of the product you’re offering. (Perhaps they’re simply testing the limits of where you’ll cave!) Listen carefully to the buyer’s concerns and try to hear where they’re coming from. Then you can work to meet their needs and expectations without immediately dropping part of the proposed deal or changing the price.

Unless you understand what the buyer is objecting to, you won’t be able to provide the right solution. Remember why your product or service is the best solution so you can also remind your customer. Focusing on the value will also drive your win rates: 87 percent of high-growth companies have a value-based approach to sales.

3. Manage emotions

Keeping your composure is important in any professional environment. It’s especially crucial for sales reps who need to remain calm even when they’re rattled or frustrated. Losing your cool is a real turnoff. A prospect probably won’t be interested in starting and maintaining a buyer-seller relationship with someone who gets flustered easily.

A great salesperson doesn’t just manage their emotions, however. They also take into account their customers’ emotions, knowing how important it is to make buyers feel valued and respected. Building trust in the relationship is based, in part, on emotional intelligence and helping a prospect engage in negotiations without anxiety, frustration, or wariness.

4. Offer trades

Rather than dropping prices like they’re hot potatoes, consider exploring other possibilities to make a deal work. Where might trades or changes in scope benefit both parties? Trading is really about finding what’s valuable to each party. The best trade is when each side concedes something in return for mutual gain.

Consider what trade options you might be able to offer ahead of time so you’re prepared for that step in negotiations. For instance, a customer might be willing to extend the length of their subscription in exchange for a lower monthly rate. The customer is satisfied with a lower cost per month, and the seller can count on a subscriber for two years instead of one.

5. Identify decision-makers

Don’t make the mistake of talking to the wrong person and wasting your time or theirs. Identify who has the authority to make the final call on a purchase and conduct negotiations with them. In some cases, more than one individual may have decision-making power. Those active listening skills will help you suss out where to place your focus.

6. Walk away if necessary

Sometimes, a deal can’t be reached. Maybe your prospect has needs that your product simply can’t address. Perhaps they’re making unreasonable demands for service. Or it might not be the right time for them to buy, so they won’t finalize a sale…yet.

A sales rep should never be willing to bend over backward to make a deal happen. Unprofitable deals are just bad for business. Plus, a buyer who wants unreasonable exceptions to terms is likely to be unhappy down the road, no matter how much five-star customer service they receive. Walking away might just save your team a long-term headache.

Knowing that you’re willing to walk away from a sale can:

  • Decrease anxiety
  • Build confidence
  • Increase buyer interest
  • Provide leverage and control of the negotiation

7. Stay positive

Negotiations can be intense affairs for both buyers and sellers. Diffuse tension with light conversation. Stick to dinner party rules, and steer away from politics and religion. Instead, make small talk about last night’s game or the escape room you tried over the weekend.

Maintaining a pleasant and positive attitude doesn’t just radiate confidence to your prospect. It also forges stronger customer relationships, which can inspire recurring deals and referrals. In the room, it might even lead to closing a deal.

Sales negotiation training

While there may be a lucky few who are naturally gifted at sales, most people benefit from a solid training program. A low-stakes arena lets sales reps recognize buyer tactics, learn techniques to respond effectively, and hone their skills.

Consider webinars and online role-playing for remote workers or reps out in the field. Whether your team is at the office or in their home office, use a buddy or mentor system to bring new reps up to speed. You should also provide regular feedback sessions to keep the whole team on track.

Benefits of sales negotiation training

Getting your team ship-shape and whip-smart at the negotiation table (or video chat) yields many benefits for your business in the short and long term.

  • Increased sales

    In addition to concrete tactics—like creating a data-driven buyer persona and implementing a clear sales plan—providing training for your reps increases sales. Practice makes perfect, and reps who’ve engaged in training exercises are more confident, highly knowledgeable, and better prepared to close.

  • Improved client relationships

    As the sales cycle draws to a close—or rather, begins to loop again—consumers become paying customers and the business pivots from sales to customer service. Clients who’ve had a positive experience in the sales process are more likely to make future purchases and provide referrals.

    When sales reps are trained to listen actively and empathetically, they’re likely already providing a good customer experience. During the sales process, they cultivate buyer trust. They can also share information about the client’s needs and situation with other team members in your CRM platform.

  • Stronger deals

    Bolstering a rep’s negotiation skills means better deals for your business. When buyers try to strong-arm changes to an offer, a trained sales rep can keep their cool and redirect the conversation to your product or service’s value. By encouraging customers to compromise, everyone can arrive at a satisfactory agreement. With effective counter-offers, your business can not only increase sales but also increase revenue per sale.

Sales training techniques

In training sessions, prepare your team with sales negotiation techniques. However you choose to conduct the sessions, consider keeping in-house sessions short and sweet. It’s also in your best interest to provide opportunities for experience in the field, mentoring, and frequent feedback.

  • Articulating clear parameters

    Salespeople must understand what concessions they’re able to make, what sales incentives they can offer, and what pricing wiggle room they have at the negotiating table. Teach your reps how to utilize sales metrics, forecasting, and analytics in your sales engagement software. By evaluating how each deal fits inside a larger puzzle, your sales team can focus on deals that make sense for the business as a whole.

  • Building trust

    Just as doctors can practice concrete skills to improve their bedside manner, salespeople can do the same to build trust with their buyers. Bolster your reps’ listening skills with exercises. Practice framing questions with empathy to uncover a prospect’s issues and challenges. Even tweaking body language and gestures can improve poise for salespeople who struggle with confidence and ease.

  • Recognizing buyer tactics

    Prepare your team to recognize and respond nimbly to buyers’ positional tactics. You may encounter customers who react emotionally to a named price or who start with a lowball offer. They may attempt to take advantage of a seller’s eagerness to close the deal by trying to squeeze out additional concessions or limiting the time frame. Or they might engage in delays, long series of requests, or limiting access to decision-makers.

    Many of these tactics can be neutralized with the skills we described above, such as active listening and handling objections. Practicing these skills in a training setting gives sellers the confidence they need to handle a variety of tactics and objections in the real world.

  • Cultivating empathy

    Customers are people, too. Do your best to listen carefully to what they’re saying and not saying—see past any tactics they might employ. What are their needs? How can your product or service address their pain points? Give them options that will address their objectives.

    Even if the sale doesn’t work out, be respectful and kind. The prospect may decide to purchase at another time or refer you to someone else in their network.

Step up your negotiation game

Plenty of factors in sales are out of your control, but practicing your sales negotiation tactics, honing your skills, and beefing up your preparation is well within your scope. All reps hope to facilitate a quick and smooth trip through the pipeline, and the right tools can make the job easier.

Zendesk’s best-in-class sales CRM platform puts buyer data at your reps’ fingertips, setting them up for success with data-driven analytics and automated workflows. When your sales team is equipped with the best tools, they can sit down at the table ready to negotiate a winning deal. See how Zendesk Sell can set your team up for success and help you drive more revenue by signing up for a 14-day free trial today.

Improve your sales process

A good sales process is the foundation of any successful sales organization. Learn how to improve your sales process and close more deals with this free guide.

Improve your sales process

A good sales process is the foundation of any successful sales organization. Learn how to improve your sales process and close more deals with this free guide.

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