One of the attractions of setting up your own business may be the idea of being your own boss or of working on your own. But no matter what you do, you are likely to need to involve other people in some way and it will be important for you to be able to negotiate with others – whether they are prospective investors, clients, suppliers or co-workers. Understanding the principles of negotiation could help to make your dealings with all of them more productive.

Most successful negotiators try to find a win-win solution, where both sides benefit, and avoid position bargaining, in which each side becomes locked into entrenched positions and makes escalating demands.

Four things assist negotiation:

1. Separate the people from the problem. You may not particularly like the person you are dealing with, but their cooperation may be vital to the success of your business – you need to make a distinction between the two.
2. Focus on interests not positions. It can be too easy to react to a single comment or perceived attitude and forget the issue being discussed. Try to identify the more general interests and concerns of the parties involved rather than the stance being taken at a particular time.
3. Generate options for mutual gain. Negotiations are likely to be more successful if you look for alternatives and outcomes that will satisfy both parties. Be prepared to develop and explore innovative options and suspend judgement until later in the process.
4. Agree criteria for solutions. Try to establish both what it is that you must get out of the negotiations and also what you would like to achieve.

Achieving satisfactory win-win outcomes to negotiations will help you gain the resources and establish the relationships that you need to make your business successful.

Content last updated: 26/05/2005

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