Episode #336 – Joanne M Smith
Meet
Joanne M Smith
Joanne M Smith is the author of ‘The Price Negotiation Playbook” and ‘Pricing in a Crisis Playbook“. Joanne works with B2B businesses and sales teams to improve their pricing strategy and capability.
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Joanne M Smith believes that negotiation preparation in 2023 will be more critical than ever. Why? Because change is happening. We’ve been in an easy negotiation market. She points out that we’re looking at a potential recession where pricing power is going to shift away from suppliers and into the hands of the customers. That’s why she believes salespeople need to plan for tough conversations. Learn what that looks like in this episode of Sales Reinvented!
Outline of This Episode
- [0:45] Why planning and preparation is an important step in the negotiation
- [1:45] The key steps a salesperson should take to prepare for negotiation
- [5:02] The attributes or characteristics that make a great sales negotiator
- [7:16] Negotiation planning tools and resources to improve B2B negotiations
- [9:24] Joanne’s Top negotiation planning dos and don’ts
- [13:27] Planning for tough conversations leads to negotiations success
The key steps a salesperson should take to prepare for negotiation
The best economists believe that we’ll see a recession within months. When it happens, a salesperson’s job will become harder. You have to adjust your strategy to be fair in the economic conditions you find yourself in.
Make sure you have a rationale for whatever your price point is. Does your industry fairly deserve more? Are you in a position where you can increase your prices?
Your leadership must look at macroeconomics, supply and demand, and the cost of inflation, and give you crisp strategies with real talking points so you can have tough conversations.
So how do you prepare for tough conversations in a negotiation?
Ask yourself, “For this deal, what are the toughest questions that I’m likely to be asked related to my offering or to my price?” In many cases, the questions will be price-oriented. When you ask those questions, you know the data you need to prepare to craft a satisfactory response.
The attributes or characteristics that make a great sales negotiator
A salesperson needs to be comfortable with tension and willing to respectfully enter into price discussions. They have to be able to guide the customer toward a better solution they might not be aware of. If you’re going to be confident, you must prepare.
Joanne asks everyone she trains: How do you self-rate on price negotiation skills and confidence? 90% of salespeople think they’re great at sales and feel like they’re mediocre at best when it comes to price negotiation.
She emphasizes that you have to take a step back and realize that you don’t know enough and start learning. Set up some frameworks to make it easy to prepare and effectively negotiate that price.
Top negotiation planning dos and don’ts
Joanne shares some great tips to keep in mind when you’re negotiating:
- Recognize that every deal you do isn’t done in isolation. Every deal sets up the future for you and your customers and the way your competitors respond. If you over-discount one customer, they’ll tell your competitors. So your competitors drop their prices. It creates a negative snowball effect.
- Make sure you have a walk-away price. Don’t agree to a low price because it disrupts everything moving forward.
- Make sure you know why you deserve the price and can stand behind it.
- Salespeople believe they have 50% or more price buyers that don’t care about value and will simply buy the lowest price. Don’t fall for that
- If someone doesn’t want to pay your price, let them walk away. Or, take away some value to give them a lower price.
Planning for tough conversations leads to negotiations success
Joanne was working with a global business in the construction space. They had a clear and fair reason to raise their prices over the last year. But their sales team wasn’t confident and was afraid they’d lose sales. Three different regions started training with Joanne. The European branch decided they didn’t need training. What happened?
The three regions that completed the training got their price increases with high success and little to minimal share loss. The region that didn’t complete training had a 30% share loss in their largest country. Her workshop covered negotiation preparation. They prepared by practicing responding to tough questions. It goes to show that preparation will always be key.
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Resources & People Mentioned
Connect with Joanne M Smith
- Connect on LinkedIn
Connect With Paul Watts
Audio Production and Show notes by
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Learn more About Joanne M Smith
Are there any books on or including Negotiation Planning that you recommend? The Price Negotiation Playbook by Joanne M Smith and Pricing in a Crisis Playbook.
In the field of Negotiation and Negotiation Planning – Who do you most admire and why? There are very limited experts in the “price negotiation” side of negotiations – one’s that provide practical, actionable advice.
Are there any aspects of your own Negotiation Planning skills that you are working on improving at the moment? I am working on practical ways to help businesses and sales on managing through inflationary and recessionary times – how to determine the best fair and appropriate price then how to best negotiate that price for success.
Hobbies, Interests? Hobbies / Interests: Hiking, Skiing, Paddleboarding, and kickboxing.
How can our listeners contact with you? joannesmith@price2profits.com
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