Do you want to enjoy good deals with large companies? Here are tips that enabled me to start and grow businesses through effective negotiations with large companies.
1. Ask the people at the large company what their business’ hopes are for the deal.
You need to know clearly what the large company hopes to accomplish. Even more, you need to know why those hopes are important to them. Dig deep until you are at bedrock. This information will enable you to find some creative and mutually beneficial solutions.
2. Agree upon a set of principles for reaching an agreement.
If you don’t have clear principles for reaching agreement, you’ll be subject to the “golden rule of large companies” – he who has the gold rules.
3. Hammer out your deal terms with the business decision maker.
If you let the large company hand it off to its procurement specialists or lawyers, you will have lost the moderating perspective of the person who really want the deal.
4. Be sure that all of the terms are on the table before you agree.
Large companies have many challenging terms in their “standard” agreements. If you agree before you know what those terms are, you will have lost your leverage to get a balanced deal.
5. Get as long an agreement as is reasonable for your business.
Longer-term contracts are worth more to investors and other sources of finance for your business.
6. Be sure the agreement includes what you need to make money.
The prospect of landing large clients bedazzles many businesses. As a result, they buy their way into unprofitable or marginally profitably deals with the hopes of more to come. Unfortunately, some large companies just use other businesses to get into a new market or product until they can get there themselves.
7. Go for a one-way exclusive.
If you’ve got something special, ask for an exclusive. This also adds to the value of your business. If the large company asks for an exclusive from you, don’t give an exclusive for any longer than you’ll need to get another large client.
8. Include an automatic renewal clause.
With high turnover In large companies, they sometimes forget about these clauses. An automatic renewal can keep your business alive.
9. Know what the large company’s choices are, and say “no” when needed.
The decision maker in a large company often reports to someone else. That person will be asking the person you negotiate with “Did you get everything that you could for us?” If you haven’t said “no” to something, you can expect them to keep coming back at you.
10. Keep perspective on working with large companies.
Finally, realize that while large companies can be very attractive, sometimes mid-sized clients are actually more profitable and enjoyable to serve. They may need you more and stick with you longer than a big company that may want to expand its own empire into what you offer.
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