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The first generation of computers.

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The fourth generation of computers

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The fifth generation of computers

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5 Mistakes You Must Avoid In Any Form of Trading

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forms of negotiation

Are you successful during negotiations? Learn about some ways of trading to avoid mistakes

Knowing how to negotiate must be a very important skill for any salesperson who wants to be successful, otherwise they will slow down the performance of their sales team.

The negotiation skills are essential in business, whether you’re a seller, or a commercial manager. Therefore, knowing the correct forms of negotiation, especially anchoring, is essential.

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Forms of negotiation and anchoring: 7 failures to avoid

The less you develop this anchoring skill in negotiation, the more opportunities will stand in your way.

Sometimes negotiators fall into traps and leave resources on the table because they can’t see the opportunity at the end of the tunnel. For this, it is necessary to avoid some mistakes and opt for the most appropriate forms of negotiation.

When you run away from these mistakes, and create good habits, you have success in your sales. Here are the mistakes you should avoid at all costs.

#1. Bad planning

Successful negotiators make detailed plans. They know that their priorities and alternatives won’t always help them reach an agreement.

You must know your limits and your flexibility points, as well as you need to understand your time and money limitations, to know that you will often need more than 1 trading meeting and the limits of your pricing.

After preparing your own agenda, start putting yourself in the customers’ shoes: their preferences, alternatives and limits.

Once you’re at the negotiating table, test your assumptions to determine what your prospect’s priorities are. Prepare an analysis of everything you can gather and study it before going into trading.

And remember the last thing that should happen in this process is price negotiation: before that, show your customer the “value” of your solution, not how much it costs.

forms of negotiation

Be ready for negotiation. This will make all the difference.

#two. Failing to pay attention to your interlocutor

Negotiators need to analyze the prejudices of their interlocutors and bring them to the table. How will they evaluate your offers?

One way to get into your interlocutor’s head and influence their attitude is to shape issues through a technique called framing, one of the most effective forms of negotiation.

If you can get your partner to accept your view of the situation, then you can influence the amount of risk they are willing to take.

Let’s say you are a commercial manager looking to renegotiate your contract with a client. The current contract is 10 reads an hour, and you want to reach 12 reads an hour.

But the customer only gets up to 11 reads an hour, and you know it’s not enough. The customer says that your competitor is willing to settle for 11 reads an hour, and tries to pressure you into giving in.

What do you do then?

It puts on the table the fact that a new hire is a question for companies. You already know each other, you already know how to work together, and you already have a detailed process.

If your customer changes suppliers, you’ll have to start from scratch. And, of course, the cost built into the exchange will be much more expensive than the difference of 1 real that is dividing you and your client.

If you know how to use this detail to your advantage, offer an even more attractive package for your client, your interlocutor will be more willing to risk the value of the hour in exchange for other benefits.

#3. Assume that the negotiations of different cultures are like the local ones

It must be remembered that there are differences in the ways of negotiating that are not necessarily negative and that these differences can create huge potential benefits – as well as big problems if ignored.

A study was carried out that focused on the construction of a large American theme park in Europe.

To convince local government officials that an American park would be a great opportunity, project developers brought European officials to a theme park in the United States.

Europeans were perplexed by what they witnessed: American culture widely present with bars, fast food outlets, gift shops and restaurants. This was not the kind of investment they wanted in their country.

Trying to be even more attractive, American executives offered more trips to other American parks for an even larger group of employees and families. It was a complete disaster.

If Americans had a negotiator more sensitive to European culture, they could have capitalized on the difference between the 2 cultures by offering a detailed presentation of an amusement park tailored to local tastes, ignoring the quirks of the American park.

In a country of geographic dimensions, such as Brazil, differences exist between states and regions.

Knowing what your interlocutor values, and understanding a little more about their cultural habits will help you to speak the same language as your potential client.

forms of negotiation

Be prepared for cultural differences in the negotiation process.

#4. Making the wrong use of anchors in trading

Anchors are part of a dynamic and one of the best forms of negotiation known as anchoring and adjusting. This involves the parameters, and the position of each party in a negotiation.

For example, a couple was selling their house for 500,000 reads. The first offer they received was 375,000 reads, which was too low an offer to consider.

So the couple responded that this was not a reasonable offer and told buyers to come back when they had a real offer.

So, buyers returned with 425,000 reads as an offer. That done, the couple gave in and reduced the property’s value to 495 thousand reads.

Once that was done, buyers returned with 430 thousand reads, but buyers have not yet accepted the offer.

Buyers claimed that, since their initial offer, they had already increased their offer by 55 thousand reads, from the initial 375,000.

But sellers were careful to remind them that the starting point was not the 375,000 reads, but the offer of 425,000 reads.

With this anchor, sellers argued that they decreased 5 thousand reads from 500 thousand reads, and that the buyer increased 5 thousand reads from 425 reads. Both had moved the same amount.

A few more rounds and the house was sold, well above the buyer’s initial offer. That’s why it’s important to know how to use anchoring in trading to your advantage.

#5 disrespecting the interlocutor

Finally, if you got the deal, never celebrate in front of your interlocutor. Negotiation is not a battle, but a step in the sales process, seeing it as a dispute is one of the worst forms of negotiation.

If you make negotiation a battle, and celebrate as if your customer has lost something, you’re losing points with him, and he’s going to believe you’re on different sides.

This can inaugurate the business relationship in a way that is not as win-win as it should be.

Respect your interlocutor. If it were the other way around, you wouldn’t want him to be disrespectful to you.

Respect your interlocutor. This will allow for fair trading.

Are you ready to be a master of negotiation?

You must be ready to negotiate, as negotiation is a natural step in the sales process.

The seller needs to know that he will go through negotiation with every sale, and he needs to be prepared for that.

Otherwise, your sales will decline, you will lose steam, and your confidence will go down the drain. You need to respect your prospect and know that you will only be able to sell if you know how to negotiate and relate to your customers.

Now that you know the mistakes you need to avoid and different ways of trading, stay on top of the 4 golden rules of trading and get ready to be an expert.