Negotiation Skills To Win The Deals

By Chetan ThakreBE. MBA, PMP, PGDPC

Education :BE (Mechanical), MBA (Finance), PMP (Project Management), PGDPC (Psychology)

Professional Experience :Worked in the field of project management and organizational change management for over 20 years in India & abroad. Worked with PMO of a one of the largest business houses in the Middle East having business interest in retail, construction, real estate and facilities management. Associated with L&D for last 6 years

Areas Of Interest :Consulting, Coaching and Counselling

Agenda

Introduction

Managing Effective Negotiation

Handling Objections

Overcoming Pricing Objections

Techniques For Closing Deals

Q & A

Negotiation

• To reach an agreement that is mutually satisfactory to both buyer & seller

• Negotiation is a process

Why Real Estate Negotiation Is Complex Task

Big ticket investment

9 out of 10 customers do digital hunt prior to buying

High emotional involvement in buying decision

Many of them seek help from real estate agents

Negotiating With Sceptical Buyer............

Duration can range from few days to 3 months

Depending on decision making process, multiple levels of authority are involved from builder side

Role of agent / broker

Complexity Of The Process

Prospect’s Budget ......

Within Your Bargain Zone

Pre-Negotiation

Knowledge

•Company , Product & Achievements

•Technical & Commercial Details Of the Property

•Competitor & Real Estate Dynamics Within The Vicinity

Administrative

•Organizing

•Planning & prioritizing

•Coordinating and networking

•Self Grooming

•Personal Appearance

•Presentation

Perception Management

It is Good To Have Standard Pre Negotiation Check List

Pre-negotiation Worksheet.docx

Managing Negotiation

Sai Euphoria - 2-3 BHK Premium Apartments

In Vishrant Wadi Pune

Features:Lifestyle Amenities* Fully equipped state-of-the-art gymnasium* Pool table* Banquet / multi-facility room

SpecificationPremium Kitchen Specifications* Designer modular kitchen cabinets with chimney & hob* Piped gas* Water purifierBathroom* Jaquar / equivalent make single lever fixtures* Designer wash basin counters* Concealed plumbing with premium sanitary fittings* Boilers for all bathrooms except common bathroom

Location:

* Just 2 min drive from airport & a 15 minute drive from camp & JM road

* Close to Phoenix Inorbit & Ishanya Mall, Golf Course, & Food Bazaar

* High Speed access to Old Mumbai-Pune Highway

* Educational institutes, schools and hospitals are in vicinity

Rate : Rs. 10,000 per square feet which is 30% higher

than the prevailing market rate in the area

Creating Perceived Value

FAB leads to SELLS

—Features are the characteristics of the property.

—Advantages are the performance traits of the product

—Benefits are what the customer is looking for from the real estate.

—Show the product’s features.

—Explain its advantages.

—Lead into the benefits for the prospect.

—Let the prospect talk positively

—Start a trial close.

F

A

B

S

E

L

L

S

Communication Skills To Create Buyer Engagement

30% What You Know70% Way You Communicate

Verbal skills

Non-verbal skills

Active Listening

Empathy

The 80/20 Rule of Real Estate Buying

80% of what drives the decision on the home purchase, is emotion, and only 20% is really strictly from logic.

Understanding Buyer’s Motivation

The “in the know buyer”: These buyers tend

to view the home “as a foundation for their

life.” They’ve researched distances and

commuting times and will not compromise on

what they must have for these life activities,

but may compromise on house size and to

some extent on price to get what they want.

Emotional connection: you let them know

you have them covered for “rock solid” location

and amenities — and they feel you understand

their goal.

Buyer : Motivation & Drives

The “I want second home”: People have various reasons want to buy a second home; some may want a vacation getaway or others want to purchase a "fixer upper" for their retirement years. .

Emotional connection: seek enhanced

lifestyle over existing home. “Bigger” “Better”

over existing catch their attention. Probe for

information about existing home.

The “Investor”: Generally a middle aged person with extra disposable income. The investor has low emotional involvement in property and the focus is on rental income and return on investment

Emotional connection: Discussion should be

around development potential in the catchment

and properly appreciation. Emotional connection

might not help

The “all in the family buyer”: They are looking for a

home they can share with different generations under

the same roof . It might be cultural reasons or

economic conditions.

Emotional connection: you show them you are

willing to factor in the opinions of different members of the family. Understand motive. Make notes these key

“stakeholders” ,remembering names of the family

members helps.

The “moving up buyer”: these are people who are

looking to afford premium properties and may

compromise on price to get the house they want with “upgrades.”

Emotional connection: you relate to them about

how good it feels to get what you want in life, and

like a coach does, you cheer them on toward their

goal.

The “sizing down buyer”: These are the “empty

nesters” and people who just want less upkeep so

they can have the time to do other things they value.

Emotional connection: Security , good house

keeping, privacy and ease of living are priorities.

Focusing on things “they value” is important

Talking Customer’s Language

Source : Briggs Myers Personality Types

Relaters: Tactics

Example : Doctors, teachers, counselors, psychologists, other caregivers

• Use empathy!

• Always reassure them that their decision is the RIGHT decision.

• Be VERY patient.

• Once they commit to the sale, don’t waste time.

• Keep a soft and comforting tone

Socializers: Tactics

Example : Advertising, marketing, public speaking, sales and travel consulting.

• Build a good rapport, but don’t push

• Show warmth, use the customer’s name often.

• Emphasize the word like “special” “great”.

• Be ready for elaborate discussion in case of conflict

Directors: Tactics

Example : Military officers, CEOs, Administrators and business owners

• Establish rapport quickly, be professional, don’t try to be friendly.

• Keep your presentation moving steadily

• Show commitment in your actions

• Always use the proper title and last name

Thinkers: Tactics

Example : Engineers, managers, architects accountants and lawyers

• SLOW DOWN! They like to write down everything and make sure they have all the information.

• Don’t be afraid to give them all of the data they want. The more the better.

• Be very precise with all of your information.

Negotiation Process : Few Tips

• Agreeing to a solution only after it works for both

parties

• Insist on using objective criteria for any objection

• Be ready with alternative solutions

• Know when to walk away

Promote problem-solving partnerships by:

• Focusing on issues where you and the prospect have

the most agreement.

• Taking a relatively firm negotiating position initially so

that when you compromise, the prospect will feel that

he or she negotiated a bargain.

• Keeping track of the issues resolved during the

discussion

Conflict Management Strategies

Negotiation Outcomes

Only one of these, the "win-win” agreement, will further the business relationship and set the stage for future sales agreements

For Effective Negotiation

Compete pre-negotiation activities

Your communication skills are important

Flex your style to suit client personality

Try to achieve win-win

Understand company strategy to manage conflicts

Sai Euphoria - 2-3 BHK Premium Apartments In Pune

What Are Buyer Objections & Resistance?

Objections are statements, questions, or actions

by the prospect that indicate resistance

or an unwillingness to buy . . .

at least not yet

• Serious negotiations seldom begin until the prospect's objections surface

• Without sales resistance, there wouldn't be any need for salespeople

• Some prospects raise objections so that they can bargain for a better deal (feel “victorious” in the negotiation)

• An objection may actually be an appeal by the prospect as reassurance for justifying a decision to buy

• In rare cases objection is raised simply because prospect dislike the salesperson

Reasons for Objections

Tips For Handling Customer Objections :

1. Don’t be defensive about objections

2. Make sure you understand the objection

3. Don’t disparage the prospect’s objection

4. Don’t try to fake an answer.

5. Admit you don’t know and promise that you’ll get back promptly.

4. Never argue with a prospect. you don’t win sales by winning arguments

6. Be specific, don’t over answer the point

7. Don’t be drawn into pointless squabbles

8. No personal comments please !

Valid Objections:

• Valid objections are sincere concerns that the prospect needs answered before he or she is willing to make the commitment to buy.

Invalid Objections:

• Invalid objections are merely defense mechanisms used by prospects to stall, slow down, or prevent the sales process from proceeding.

• They are difficult to identify and overcome because the prospect does not deal with the salesperson in a straightforward, honest manner.

Needs Objections

Needs objections are raised by prospects who have investible fund but feel they simply do not currently need or have use for real estate investment.

How To Manage ?

Handling “no need” objections requires innovative approaches by salespeople to educate prospects on the potential benefits to be derived from purchasing real estate

Example – returns, security for old age, rental income etc.

Valid Objections

Product Objections

Product objections are usually concern the features, advantages, and benefits associated with a property offered by you.

How To Manage ?

When prospects use this form of resistance to purchasing, salespeople should provide additional information to reassure them about benefits and if necessary alternative options

Price Objections

Price objections are the most frequently raised form of initial resistance.

. Budget limitation

Take it or leave it

Split the difference

Price Objections

To counter price resistance, salespeople must show that their product or service offers the prospect higher value over investment spent than competitive offerings.

Perceived Valued > Offer Price

Value Analysis

Basis Of Costing

Property Cost Versus Value

Return on Investment

Tips For Dealing With Price Concerns

• Do not make price focal point

• Do not apologize for the price

• Cover intangible benefits as well as tangible ones.

• Wait for right time to make price concessions if any

• Understand if buyer’s price resistance is a ploy

to conceal their real reason for not buying

Persuasion & Close The Sale

Send follow-up message Thanking customer for time Additional information promised to customer

Focus on building trust : Fulfil action items at theearliest and send relevant information . Build trustwith your prospects and clients, and sales are sureto follow.

Build a sense of urgency : Urgency is one of the mostimportant sales persuasion techniques because itworks. However, sales persuasion techniques basedon urgency don't need to involve pressure and bluntexpression of deadlines

Closing and Confirming the Sale

When to Close• There is no single, best time to attempt a close

• Numerous verbal and nonverbal signals or cues indicate

that it's an appropriate time to try a close.

• Use trial close : a trial close is any well-placed verbal or

nonverbal attempt to close the sale which can be used

early and often throughout the selling process. It can be as

simple as saying: “So, what do you think?” Or

nonverbally

Silence Can Be Golden In Closing

When to Close : Non Verbal Signals When The Prospect

Starts closely looking at property information

Seems pleased about product features

Looks relaxed and friendly in the communication

Increases eye contact with sales person

Looks over the order form

Unconsciously reaches to check book

Accepts order form and pen from sales person

Looks with satisfaction towards accompanying family member / associate

Straightforward Closes Persuasive Closes

Concession Closes

Straightforward Closes

Summary Close : Summarize the advantages and disadvantages of buying the product before asking for the order

Ask For The Order Close : Ask for the order directly. Start filling out basic information on the contract form, then hand the order form and a pen to the prospect for approval

Letting Customers Close the Sale

Consistency Principle : If you can achieve a series of positive agreements with the buyer on individual property benefits during the sales presentations, the stage will be set for a close that is merely a continuation of this pattern of positive responses

Reciprocity Principle : When one person does someone a favor, the second person usually feels obligated to return the favor

Social Validation Principle : Prospects are more likely to buy your property when they learn that people and similar companies to themselves have purchased it

Persuasive Closes

Scarcity Principle : When a product becomes scarce, it is often perceived as more valuable and desirable

Impending Event Close : Warn the prospect about some upcoming event that makes it more advantageous to buy now. emphasizes the specific advantages of making a timely decision, while still stressing a sense of immediacy

Reserve Advantage Close : In this slight variation of close described above, salespeople identify a number of merits for purchasing a product, but save a few to use if the prospect exhibits resistance yet again

Persuasive Closes

Concession Closes

Special-Deal Close : Offer a special incentive to encourage the prospect to buy now.

No-Risk Close : Agree to take the product back and refund the customer's money if the product doesn't prove satisfactory.

Management Close : When salespeople do not have the authority to make the prospect’s requested commitments or concessions, they can elicit the assistance of a senior sales manager who has the authority to make the necessary decisions to close the sale no-risk close sale.

Concession Closes

Pretend-to-Leave Close : Start to walk away, then "remember" another benefit or special offer after the prospect has relaxed his or her sales defense

Ask For Help Close : When the sale seems lost, apologize for not being able to satisfy the prospect and ask what it would have taken to get him or her to buy; then offer requested deal

Closing Mistakes

Examples of closing mistakes include:

Talking past closing signals

Failing to recognize prospect buying signals

Projecting a lack of confidence

Reluctance to try trial closes on early calls

Giving up too soon

Lack of alternative closing strategies

How Do You Handle Sales Rejection?

No One Wins All the Time :Salespeople won’t make a sale each time, but they can learn from each rejection and be better prepared for the next sales call.

Learn From Rejection : When salespeople are unable to close a

sale, they should not feel discouraged or personally rejected. Instead of failure, rejection should be viewed as:

A learning experience that will motivate you to do better next time.

Helpful feedback that will spur you to develop more creative closing approaches.

The motivation to spend more time practicing selling skills and improving performance.

Effective Ways To Manage Stress Of Rejection

Never equate your worth as a human being with your

success or failure as a salesperson

Separate your ego from the sale

Don't automatically assume that you or your selling skills are

the problem

Move on to other prospects

Master healthy relaxation techniques

Post-Close Goals

Assist Serving And Satisfying The Customer Till End Of Sales Cycle

Remember That The Long-range Goal Is Customer Loyalty

Be assertive understand reason for objection

Need related – property is best investment

Product related – highlight benefits or suggest other alternatives

Price related – focus on value rather than absolute price

Closing Strategies : Straightforward, Persuasive, Concession

Defence Mechanism & Long Term Coping Strategies For Rejection

SCR-

A

SCR-

B

SCR-

C

SCR-

D

1 Likes authority Enthusiastic Sensitive Feelings Likes Instruction

2 Takes Charge Takes Risks Loyal Accurate

3 Determined Visionary Calm Consistent

4 Enterprising Verbal Enjoys Routine Predictable

5 Competitive Promoter Dislikes Change Practical

6 Problem Solver Enjoys Popularity Gives in To Others Factual

7 Productive Fun-loving Avoids Confrontations Responsible

8 Bold Likes Variety Sensitive Prefers Perfection

9 Decision Maker Spontaneous Nurturing Detail Oriented

10 Persistent Inspirational Peace Maker Analytical

Choose the item in each line that is most like you and put 4. Then pick the item that is next most like you and put 3. Then 2 and then 1 which is least like you. Do this across the page for each list of descriptors.

What is your personality

SCR-A SCR-B SCR-C SCR-D

Total Directors Socializes Relaters Thinker

DirectorsNatural Strengths Natural Weaknesses

Decisive ImpatientGoal Oriented BluntAchievement Driven Poor ListenerGets Results ImpulsiveIndependent DemandingRisk Taker Projects More Important than PeopleTakes Charge Can Be Insensitive to the Feelings of OthersTakes Initiative May “Run Over” Others who are slowerSelf Starter Fears Inactivity, RelaxationPersistent and Efficient Quickly Bored by Routine or MechanicsDriven to Complete ProjectsCompetitiveEnjoys Challenges, Variety and Change

Natural Strengths Natural WeaknessesEnthusiastic UnrealisticOptimistic Not Detail OrientedGood communicator DisorganizedEmotional and passionate ImpulsiveMotivational and inspirational Listens to “Feelings” above “LogicOutgoing ReactivePersonal Can be too TalkativeDramatic ExcitableFun Loving

Socializes

Natural Strengths Natural WeaknessesPatient Over AccommodatingEasy Going May Sacrifice Results for the Sake of HarmonyTeam Player Slow to InitiateStable Avoids Confrontation Even When NeededEmpathetic Tends to Hold Grudges and Remember “Hurts”Compassionate Fears ChangeSensitive to Feelings of Others

Tremendously Loyal

Puts People Above Projects

Relaters

Natural Strengths Natural WeaknessesAccurate Too Hard on SelfAnalytical Too Critical of OthersDetail Oriented PerfectionistThoroughness Overly CautiousIndustrious Will Not Make Decision Without “All” the FactsOrderly Too PickyMethodical and Exhaustive Overly SensitiveHigh Standards

Intuitive

Controlled

Thinker

I hope you enjoyed and found this module useful.

Wish you all the best for your real estate management career.

If you have any feedback or query, please contact

info@aarquz.com or Chetan Thakre (8446898080)

Specific Negotiation Methods

• Superior benefit Acknowledge prospect has valid concern and focus on

superior benefit

Superior benefits should outweigh specific customer concerns

Ex. I understand your concern that our coast is on higher side but we use only best quality XXXX fittings

Specific Negotiation Methods

• Questions Convert problem into need-satisfaction question

Boomerang: turn the objection into a reason for buying

Example “How would 24 X 7 full generator backup will help your wife and kids any inconvenience when you are

away?”

Specific Negotiation Methods

• Direct denial Refute prospect’s opinion or belief

Be firm, not offensive

• Indirect denial Acknowledge prospects as partly right

Example : • Your information about our company is not correct.

Sometime bloggers publish misleading posts. Instead refer to XXXX if you want information about our company

• “I agree, others have felt the same way”

Specific Negotiation Methods

• Demonstration Discuss competitive advantages of your product Demonstrations overcome buyer skepticism

effectively Case history: tell experience of a satisfied customer

• Trial offer Prospect tries product without purchase commitment

Example : Come I will show you ready apartment in building A. You can see quality by yourself

Specific Negotiation Methods

• Third-party testimony

Neutral third-party testimony adds credibility

Almost never triggers client argument

Example :

I will give you number of our existing clients to check quality of our service

Specific Negotiation Methods• Switch Focus Strategies

Alternative product : switch focus to another feature

Comparison or contrast: compare product with another

Humour: use light-hearted humour to ease tension and redirect the focus

Agree and neutralize: give some level of agreement, then explain benefit

Specific Negotiation Methods

• Postpone method

Postpone answers to client concerns until later in dialogue

Explain why you want to postpone

Pass-off: keep a pleasant expression but say nothing

Example : Lets first see if the property meet your requirements and then we can talk about price