Negotiating for a Construction project? Whether you’re an owner negotiating with a contractor or a contractor negotiating with a sub-contractor, you should get your game plan in order.
Negotiation tactics can help you reach the best agreement and allow you he opportunity to discuss your successes and how your better than the competition.
To get you started, here are 7 negotiation tactics to boost your bargaining power.
1. Practice Being an Active Listener
At the bargaining table, a head nod every once in a while is not enough for the other person to know that you understand what is being said. Posture, facial expressions, head movements, and hand gestures are all signs that can show whether you are listening or not. So how can you make it clear to the other person that you are not only listening but understand? Maintain eye contact, acknowledge if you agree with an ‘I agree’ instead of a head nod, don’t interrupt and paraphrase when you can to make sure you are fully on board with what was being said.
2. Ask Open-Ended Questions
Try asking open-ended questions to keep the dialogue flowing. For example, “what price would work for you?” or “Tell me! Why does this price seem too high? – Is it because of the results you have seen in the past?”. These question can help you talk about your positive results, successes of your previous projects and how you can accommodate them best.
3. Set High Goals
Give yourself a goal. If you know that you can reduce your price by 20%, negotiate a change in project timeline and price cut. A study by DePaul University found that if you set specific, challenging goals you will be able to secure a better deal compared to going into a negotiation with no goals of what you want.
4. Play To Their Emotions
When deciding on contract terms or negotiation agreements, most people use their emotions as part of their decision process. Try talking about your current clients and recent projects to make the them excited to start working with you. This allows for transparency and can establish a solid relationship.
5. Be Confident That You Are The Best Option
This is where you believe that you are the only option that can get the job done right. By securing their confidence and letting them know you understand their challenges will put you in a better spot. You can take it one step further and offer solutions to their challenges that only you can fix. This will prove that you have more to offer than your competitors.
6. Emphasize Urgency
If you’re negotiating for a third party or for yourself and have multiple projects going, remind the client of the consequences of delaying the project during the proposal phase to avoid any conflict later on. Transparency is key.
7. Be Gracious
Hopefully after all of this negotiation, you have built a relationship and a mutual agreement on a path moving forward which benefits both parties. Clear dialogue is the best way to communicate with stakeholders, build better results and stronger partnerships.
If you have experience presenting bids and negotiating for a project, what negotiation tactics did you use to set yourself apart from the competition?
For more related information, read 4 Common Construction Bidding Errors And How To Avoid Them.
Source: Negotiation Tactics