Key Negotiation Skills _ 101


Some of you might think that negotiation will rank low on the ‘business know how” list. ¬†However, negotiation skills are one of the most crucial skills required for any organisation to excel and grow. It is a soft skill that can be trained the more you engage in it. It is important for negotiating and soliciting work from potential clients as well as working out a win-win situation for yourself and suppliers. Some would call business negotiation skills the same as sales negotiation skills because essentially you are selling your company to a supplier to offer you good terms and conditions and to work with you.



For the purpose of this article, we will discuss negotiating in the context of creating good supplier and client relationships.


Most times you will not be seeing your suppliers. That is because a lot of business is conducted on the internet and through email communication. So we will go through the skills that you need to master one by one. Let’s get into it.



Communicating with your supplier in a direct and honest way is the best way to open up dialogue. Always introduce yourself and your company. Explain what your company does and why you have contacted them. Tell them that you are a representative of your company even if you are the business owner. This gives the impression that you are an established entity even if you have only just started your business. Tell them why you have contacted them and why you would like to use them as a supplier. Tell the supplier some things about the vision of your company and where they will fit as you scale your business.

You must always remember to leave your ego at the door. The goal of communicating effectively is to find the common ground that is a win-win situation for both of you.



Understanding your supplier’s culture and customs will get you respect from them as a business partner. Most suppliers today are found in the east. Many of them coming from China and the surrounding region. It is important to know the etiquettes that are in the cultures there. Respecting them and being polite yet firm can and will go a long way. You have to make sure you ask all the necessary questions. Sometimes they will not divulge all the crucial information as they will be trying to win the business from you so make sure you always talking to more than 1 supplier to gauge what details the product entails you are trying to source or manufacture.

As an example, if you were working with Malaysian suppliers, many of them are Muslim. So shaking hands with a women representative would be a no-no and considered offensive. They are big on titles and always address them by using Sir or Mr. before mentioning their first name. This is considered respect in their culture.


Know When To Walk Away

Knowing when to walk away from a deal is crucial as not to be coerced into something that could be damaging to you and your business. If the deal favours you but can hurt the supplier they might not want to work with you for subsequent orders. If the deal hurts you but favours the supplier then you should walk away as the deal could have financial implications for your business. It is not as clear cut as this, therefore, you have to make sure you weigh up the pros and cons of each decision.

Many times when you take a step back and tell suppliers you need to think about things after discussing it with your boss they will come back with better terms that are more suitable making it a win-win situation for both parties.


Don’t Put All Your Eggs In One Basket

Chat to more than one supplier. I would usually contact 5 or more suppliers and test to see how they respond. Things I personally take note of is how quickly they respond. What is the tone they respond in? Do they try to accommodate you and get the business or are they nonchalant about business? Chatting to many suppliers will give you a feel for what the suppliers can offer and what value you will get from them as a supplier.

The most important thing for me when selecting a supplier to work with more than price is availability and communication. When dealing with someone you have never met you need to feel comfortable that they are doing the job spec as per your requirement. It is a very unsettling to have a supplier respond to you infrequently and in their own time. A sense of urgency from the supplier side helps you remain calm and focus on other aspects of your business that also need attention.



When starting out it is best to select a supplier that speaks your language. Most Chinese suppliers have English speaking sales people that work for them and can communicate effectively. It is always best to choose a supplier who can engage with your or your representative in a common tongue. English is the preferred language for international business as the biggest consumers of products from the East are your Western Nations. It is the business language even though the most spoken language is Mandarin.



Basic etiquette goes a long way in Eastern culture. the exchange of gifts create a friendly atmosphere and serve as a welcoming ice breaker. A gift that represents your culture or country is best given to suppliers from a different culture. Please and thank you go a long way to demonstrate to them humility and that you are seeking to develop a long lasting relationship with them going forward. Shaking with 2 hands and not 1 also shows that you respect the person and value them. It also demonstrates that there is equality between the 2 parties. A one-handed handshake can come across as pompous and arrogant to the Eastern supplier and make him view you as somebody that should not receive any favours.



Always make sure you know what you want and you communicate that in a clear way and in uncertain terms. Suppliers should know that they are dealing with someone who is serious about doing business and if they cannot service you that you will move on to finding a supplier who is able to assist you with your demands.


Emotional Control

Controlling your emotions is very important as you need to separate your head from your heart when making business decisions. Do not let your emotions take over while negotiating. Sometimes it can be frustrating when the other party is not being civil during discussions but this is where you must realise during the end of negotiations you will have the situation under control and within perspective. Always try to keep religion and politics out of negotiations when both parties are from different persuasion but at the same time respect customs and traditions while conducting business and negotiations.



Learn to collaborate with your suppliers to create meaningful relationship building. Remember you need to create a situation that favours them as well so that you can get good rates, services and ideas from your supplier. The one hand washes the other hand so let your supplier know why they should be doing business with you.


Weigh Up The Pros and Cons

The best way to do this is open up a simple excel spreadsheet with a checklist that needs to be ticked off, yes or no. You can add things such as “Speak English?”, or ” Price Per Unit”. You do this checklist for each supplier you chatting to and the one that scores the highest on your checklist would be the preferred supplier to go ahead with and do business.


In Conclusion…

The above are the exact steps that I follow when negotiating with my suppliers. My take home message is to be open and honest and do NOT lie about the size of your business. If a supplier can’t see the potential in you then you probably shouldn’t be doing business with them anyway. Move on and find a supplier that is willing to work with you and your team.

If you are able to send a thank you gesture on the conclusion of business it will cement the relationship that was developed making future business dealings pleasant and more amicable to further negotiations if need be.

If you have any further input or questions do not be afraid to ask or comment in the section below this article. I do not claim to know everything and would love for my readers to add value to this topic.




4 Comments to “Key Negotiation Skills _ 101”

  1. Great article and I agree100%.

  2. Yes, nice article….Do not put all your eggs in one basket. Great

    1. Putting all your eggs in one basket is setting yourself up for failure.

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