Get All Access for $5/mo

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.

Side Hustle

The Side Hustle He Started in His College Apartment Turned Into a $70,000-a-Month Income Stream — Then Earned Nearly $2 Million Last Year

Kyle Morrand and his college roommates loved playing retro video games — and the pastime would help launch his career.

Science & Technology

Why We Shouldn't Fear AI in Education (and How to Use It Effectively)

Facing resistance to new technologies in the educational process is nothing new, and AI is no exception. Yet, this powerful tool is set to overcome these challenges and revolutionize education, preparing students and professionals for a future of unparalleled efficiency and personalized learning.

Business News

Apple's AI Has a Catch — And It Could Help Boost Sales

Not every iPhone owner will get to use the new Apple Intelligence.

Business News

Elon Musk Threatens to Ban Employees from Using Apple Products, Says Will Lock Devices in 'Cages'

The Tesla founder sounded off on X following Apple's 2024 Worldwide Developer Conference on Monday.

Business News

Y Combinator Helped Launch Reddit, Airbnb and Dropbox. Here's What I Learned From Its Free Startup School.

The famed startup accelerator offers a free course on building a business — and answers five pressing questions for founders.

Business Culture

You'll Always Have Anxious Employees if You Don't Follow These 4 Leadership Tactics

Creating a thriving workplace environment hinges on the commitment of company leaders to nurture and inspire their teams.