Objectives

1. Recognise situations where you are faced with a potential negotiation
2. Learn the key steps to successful negotiation
3. Use LIMB objectives for every negotiation
4. Discussing terms and conditions using confidence giving language (negotiation may not be required)
5. Know how to handle client tactics and objections
6. Bottom line needs and walk away points
7. Successfully negotiate with clients to maintain the fees you are proposing

Negotiation

What do you we mean by it?

1. Negotiation is possible when 2 or more parties have something they need from each other and visa versa
2. Thinking about what you have to offer, give, be flexible on, not just just discounting or haggling over prices
3. The best negotiations leave each party feeling taken care of; a win - win and everyone feels happy, and not ripping someone off

When might it be appropriate to negotiate?

1. Increasing the scope of service eg dual branded client paid advertising and microsite landing page, candidate market mapping, HR assessment tools administration, technical testing (increasing fees)
2. Difference in the rates you offer and the client normally pays
3. Discussing your fee %s, payment days from invoice date, and any refund guarantees
4. Agreeing the interview and selection decision making process
5. Salary / compensation levels or job titles
6. Volume discount for multiple job openings or and placements
7. When interviewing candidates about needs and compensation ranges

How will you prepare?

1. Think about what your intentions are with clear objectives
2. Objections that may be thrown up as hurdles to overcome
3. Previous history / relationship with that person and other stakeholders
4. Gather any relevant information and knowledge
5. Know your service fully (most relevant features and advantages) and all it's benefits

You can set limits, boundaries and parameters...

What are LIMB objectives?

L = Love to achieve

I = Intend to achieve

M = Must achieve (or leave the door open and ask them to keep in touch)

B = Bottom line walk away point (after you tried again and it became worse)

Why is MUST so important?

1. This is your walk away point
2. No point agreeing to a deal that is going to cost you or your company money, and with a bad agreement that you will not feel motivated to complete on
3. Being too flexible may damage your brand
4. It can set a dangerous precedents
5. The walk away point is final, if your walkway point is 25% and a client offers you 24% and cannot go any higher you have to walkway.
6. If you can improve the relationship, secure more business, more opportunity, make things easier and better for you, you might consider slightly less, for a trade of more

What are your walk away points?

1. < 25% for senior, confidential, client branded search and selection campaigns
2. No deposit
3. Must be exclusive for search
4. < 20% for 5-20 jobs filled
5. < 20% for a margin only consultant placement
6. If the client contact or candidate will not meet you either video on or in person
7. Client will not agree the job description or person specification including MITs (most important things)
8. Client wants a refund if the candidate leaves during 12 months and free replacement (if they pay 30% fees, on time, and they candidate's employment was terminated for gross misconduct, fake qualifications, we will offer a free replacement, if possible but not normally after 3 months service)

What would you LOVE to achieve?

1. Exclusivity (on all business, future business, limited time frame on this business)
2. Video or Written Testimonials
3. Future Business
4. Referrals & recommendations to network
5. Multiple bookings
6. Direct introductions into interview slots (client accepts candidate for interview without any objections and pre-agreed calendar slots)
7. Roles with higher salaries / compensation
8. Mobile numbers, direct lines
9. Interview slots
10. Interview day for 3-4 candidates
11. Agreed time scale for decisions
12. Visits to take feedback
13. Other points of contact
14. Feedback post interview

‘If you want a guinea pig, start by asking for a pony’, Annabel, aged 6!

Terms of Business

When should you discuss terms of business?

1. Professional and credible to agree terms and conditions with your client early on in the process rather than leave it until offer stage
2. Be upfront with clients and be clear on fees, service and terms and conditions
3. Do not hide fees and risk a client demanding a lower fee at offer stage
4. Once you have established an opportunity as one you intent to secure, you should seek agreement to your terms and conditions before working on the job

How would you present your terms of business?

Avoid using language that suggests you can negotiate.

Do not say:

“Our standard terms of business”

“Our full fees are…”

“Our normal terms of business…”

“These are our terms of business, they are negotiable.”

“Normally our clients pay…”

“Our usual terms of business are”

Matching is Effective Selling

Why is it important to match and sell the benefits of your service?

1. Explain the benefits of working with us / you
2. Show the client how you are going to help them
3. Match what you have to what the client wants or needs
4. Build value in what you are offering
5. So they realise it is not just for our benefit
6. It will help them get what they want
7. To give meaning and value to the fees we are asking for
8. We need to sell our core service to clients and differentiate ourselves as not just another agency or consultancy

Benefits are: save time, remove hassle, total cost reduction, maintain and enhance productivity, give peace of mind, facilitate profitable, sustainable growth.

Negotiating Fees

Why will a client want to negotiate?

1. To see how you react (they need to know you can overcome objections with talent on their behalf and close deals)
2. Clients want to feel like they are getting the best deal they can from us
3. Don’t ask don’t get! Are they are trying it on....
4. Maybe they are comparing you to competitors purely based on fee
5. You have not sold them the value of the service we are offering to them with effective matching and benefits
6. They expect a reduction in fees, because they have always got one before (bad precedents have been set)
7. Can not afford / does not have budget

What might a client say to encourage a reduction?

1. “I only every pay 12%”
2. “The other agencies have offered me a better deal?”
3. “That’s way too expensive!”
4. “We only have x amount in our budget”
5. “If you want to have exclusivity you will have to give me a better deal”
6. “It’s company policy that we only ever pay 15%”

Objections

How do you handle objections?

1. Are these tactics or smoke screens?
2. Expect them
3. Recognise them for what they are: tactics
4. Acknowledge them, respect them, repeat them back, and ask why
5. Clients view consultants who give in too easily as ‘easy touches’. You lose credibility.
6. Ask questions. Focus on the reasons behind the demand, eg if I could do that, how would that help you? Don’t give in.
7. Educate your clients on the service we offer to them and the market

Trading

What could you trade?

Things we might prefer:

• Exclusivity
• Branded advertising
• Signed terms
• Short payment terms
• Agreed Time Scales
• Future Business
• Volume Business
• Referrals
• Testimonials

Things the Client might prefer:

• Face to Face Interviews of Candidates
• HR assessment tools
• Custom Technical Testing
• Reference Checking
• Salary, compensation and benefits surveys
• Clearly defined service levels
• Internal recruitment eg assess all their direct applications
• To use your ATS
• Exclusivity on talent eg you don't send a resume to another client for 30 days

How do you trade?

Never give anything away for free:

1. Trade reluctantly and slowly, if they feel they have won, they have done their job, driving a hard bargain increases a sense of achievement
2. Use, IF you can do this, THEN I will…use tentative exploration – trial close‘
3. Use silence as a weapon – wait for them to respond
4. Stress the cost (financial or pain to you of doing it)
5. Refer to a problem that you can solve
6. Make exceptional concessions, ‘I would never normally do this...”
7. Tell them they’ve got a good deal and they have got the best deal

Deadlock

What would you do if you came to a deadlock?

1. Ask your client for suggestions, “what do you suggest we do?’
2. If they say I don't like to barter, this is no good (they are trying to create fear of loss, stay calm, and agree however this is an important negotiation and they are important to you)
3. Stall – let them cool down and return to the negotiation in 5 minutes, return with a slightly better offer and let them know how hard it is to do this deal
4. “I’ve reached my bottom line”
5. “I really want to work with you, this really is the best I can do”
6. “We want your business, let’s go through it one more time and see if we can work together”
7. Explain that you would love to take the offer they have made, it really isn’t possible however; IF you move towards me THEN I will move towards you.

Fee Reduction

Under what circumstance?

1. Exclusive business (we fill nearly all exclusive business however for senior or retained it is higher risk for us and required 100% commitment so don't go below 25%)
2. Confirmed volume business (last year or last 6 months)
3. Promised Future Business in Writing
4. Take a look at the bigger picture, how big is the £/$ value to %
5. Opportunities to receive opportunities from other departments in the business of a large firm that could generate 20-40 extra jobs per year
6. Crash in markets eg recession or global health problem (economic)

How do you handle it?

1. Slowly, reluctantly, be stingy
2. If we concede on price, we must get something back in return
3. Work out how much this is going to hurt you in the pocket
4. Is there anything other way you can add more value – check
5. Make them think they’ve hit your bottom line
6. Tell them how unusual it is to do this
7. Ensure any agreements you make as a one-off are clear
8. Never reduce the cost off your percentage fees. Always take money off the total invoice value
9. Get all agreements in writing. If you don’t put it in writing, you have nothing to back up the conversation later on if you need it

Walking Away

How do you do this?

1. With respect and gratitude
2. Keep the door open
3. Wish them good luck with their current method or other options
4. Say you will call them in a week or 2 to see how they are progressing or if they have any further questions
5. Send them a concise summary email, expressing you interest in supporting them in the future with all your contact details