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Business Negotiation Joe Piernock Corporate Development Services PowerPoint Presentation
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Business Negotiation Joe Piernock Corporate Development Services

Business Negotiation Joe Piernock Corporate Development Services

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Business Negotiation Joe Piernock Corporate Development Services

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  1. Business NegotiationJoe PiernockCorporate Development Services

  2. Phases of a Business Arrangement • Preparation • Negotiation • Contract • Operation • Termination

  3. Preparation Remove emotion from the process: • Set your financial and business objectives • Prioritize AfBA candidates • Your operational and financial factors (use the Model) • Your business and strategic factors • Their needs and objections • Define your Best Alternative (to this deal) • Define your Target Price • Define your legal risk threshold • Plan your attack • The order you will approach each candidate • Individual tactics

  4. Preparation (continued) Business and strategic factors: • Reduce a coming loss of business • Strategic block • Reduce business risk • Gain the market’s “high ground” • Strong partner to grow business • Enter a new geographic region

  5. Negotiation’s Phases • Discovery – revealing information to define needs • Focus on your Target Price • Discuss their underlying needs and beliefs, not demands • Never lie or reveal facts about your Best Alternative • Opening Offer – sets the range of expectations • Research says this is more important than we think • Concessions – lead to the final offer • Make them small – Reciprocity is human nature • They are not gifts – use “If… then” statements • Final Offer - you must be willing to walk • Do not lie

  6. The Heart of Negotiation • “BATNA” • Define the other party’s • Best • Alternative • To • A • Negotiated • Agreement

  7. Negotiation Tools • Zero Sum Game – Always look to make the pie bigger • Nondirective Listening – Ask about Feeling, then Facts, then Solutions • Deadline – Set a deadline and keep it • Risk – most would rather avoid a risk than have a gain • Contingency – Break logjams with contingency deals • Differences – provide opportunities for mutual gains • Different forecasts, risk aversion, capabilities, core needs • Intermediaries – pros and cons • Hired guns • “Liking” matters • Bluffs

  8. Written Agreement • You have an advantage if you control the paper. • Final language • Pace of the negotiation • Operational issues • Rigorous performance reporting for the entity • Define scrupulous accounting of all metrics. Provide examples as attachments. • Termination • Always set a termination date • Know your deal breakers

  9. Elements of a Lasting Arrangement • Good Partner • Enough revenue • Fair financial arrangement • Accounting is not a burden • Operations are not a burden • Little collateral damage to other business