Negotiation is a useful skill in most areas of life, particularly when you run your own business. Like all skills, negotiating a better deal with your suppliers is something you get better at with practice and experience. Read our tips (and key points to remember) for more success with business supplier negotiations.
Whether you’re shopping around for a new supplier or trying to renegotiate with an existing one, keep an open mind. Your suppliers might not budge on price, no matter how persuasive you are – they might not even be able to drop the price.
So what else could you ask for that will help you bring down your expenses or operate more efficiently? For example:
Different shipping options so you can receive goods faster, or to multiple locations
Bespoke fee structuring, rather than paying an ‘all-in-one’ package fee that includes things you don’t use
What can I use as leverage when negotiating?
Successful negotiation is built on everyone getting something from the deal. To avoid the discussion ending with a very quick ‘nope’, identify what you can use as leverage. Even a supplier who is desperate to make the sale will want the best deal possible.
As such, you might emphasise how much business you’re likely to give them. You might offer a larger deposit which could be useful for their own cash flow, in exchange for a bigger discount on the total price. If you’re working on a high-profile project, could you give your supplier good coverage in return for favourable terms?
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How firm do I need to be when negotiating?
Being good at negotiating doesn’t mean going in there like a Viking charging into battle. Haggling does take nerve, and projecting an air of confidence will help suppliers understand you should be taken seriously. But.
Be observant, and try to understand what the other party is telling you, and not telling you. It might point the way to something you can offer in order to reach an agreement which works for you both. Plus, this brings us very nicely to our next point.
Be the business that suppliers want to work with
Your suppliers are running their own businesses, which means they have their own interests to look after too. And as we all know, there are some customers that, no matter how much money they bring in, just aren’t worth the hassle.
Supplier agreements are reciprocal; they might want your business, but you need their product or service. So be the kind of customer that you like to do business with! As well as open honesty and paying your bills on time, work towards getting a reputation for passing on the good stuff.
So, if you get good feedback on something and want to shout about it, include the supplier who was part of making it happen.
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About The Author
A content writer specialising in business, finance, software, and beyond. I'm a wordsmith with a penchant for puns and making complex subjects accessible. Learn more about Elizabeth.