Think Like a Negotiator Knowing how to negotiate is always important, especially when cash is tight.

By Sara Wilson

Opinions expressed by Entrepreneur contributors are their own.

When celebrity hairstylist and beauty expert Billy Lowe, 38, decided to relocate his six-figure business from Beverly Hills, Calif., to West Hollywood, he took advantage of the downturn in the economy to negotiate a deal with his new landlord. For bargaining power, Lowe stressed the benefits of his occupancy: He already had a loyal following of high-caliber clients; he would give the building a clean, polished, updated look; and the landlord would incur costs if the building sat vacant for too long. The landlord was convinced and agreed to both a reduction in rent by about $400 per month and a three-year lease at a fixed price.

Meanwhile, Ken Wisnefski, 37, founder of WebiMax.com, a provider of online lead generation services in Mount Laurel, New Jersey, managed to secure a better advertising deal. By committing to a longer-term advertising contract, he cut his ad costs in half. He projects 2009 sales to exceed $1 million.

Knowing how to negotiate is always important, but when cash is tight and sales are down, this skill alone can make a huge difference. In fact, Jim Camp, a negotiations coach and author of Start With No: The Negotiating Tools That the Pros Don't Want You to Know, estimates that 90 percent of an entrepreneur's failure is due not to poor business planning, but rather a failure to negotiate properly. So how do you seal a better deal? Camp offers the following tips:

  • Create a vision. Just as Lowe did, it's essential to clearly demonstrate how this partnership or contract will benefit the other party. "You've got to be in their world, creating a vision for them on what this does for them," Camp says. "So often people get bogged down in facts and figures and data."
  • Don't believe you have all the power and avoid using terminology like "take it or leave it." "Negotiations are done in an entirely emotional arena," Camp says. "The human mind functions in the emotional until it makes a decision. People who are rough or aggressive or pushy often create an emotional reaction that they're never going to be able to overcome."
  • Know what you want to get out of the deal and make sure it's achievable. "So often I run into entrepreneurs who don't really know what they want," Camp says. "They have to know what they want. That's a critical piece to the puzzle."
  • Don't compromise beforehand. "Never ever go into a meeting with a fallback position," Camp says. "That's the worst thing you can do."
  • Invest in the skill. Don't rely only on your natural talent because negotiation really is a science. Read a book, sign up for a course and look at each negotiation experience as an opportunity to learn and improve.

To learn more about negotiating for your business, click here.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Growing a Business

7 AI Tools That Help You Build a One-Person Business — and Make Money While You Sleep

Who needs a team? These seven AI tools let you automate everything, scale like a beast and reclaim your time.

Money & Finance

Make Money on Autopilot With These 5 Smart Passive Income Ideas

Five innovative ways to earn money even when you're sleeping.

Business Ideas

70 Small Business Ideas to Start in 2025

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2025.

Business News

Microsoft Created an Ad Using AI and No One Picked Up On It: 'Saved 90% of the Time and Cost'

Are AI-generated ads indistinguishable from human-created ones?

Buying / Investing in Business

This Team Is Making Sports History by Giving Fans Ownership

The city of Oakland is reviving its sports legacy, and you can be a part of it.