Contract Negotiation

All about the relationship and leverage... 

Contract Negotiation Strategy

"Identify the 
relationship."

Signing Contract

"Can both parties win?"

Conference Room

"Think with, not against."

According to a 2001 study, researchers found that commitment and compromise were the two highest valued ideals in business negotiations. Our strategy blends both. 

#1. Identify the relationship between the FI and the proposed vendor, the actual relationship. Are you a reference FI?  How many total products do you own already?  What's in the queue?  How did the last implementation go?  It can be difficult to assess within the bubble.

#2. Define the compromise. What is the acceptable give-take? Can both parties win?  What does your FI truly require?  Once the need is adequately understood, the wants are easy to work with. Arguing for everything creates a greater chance of receiving nothing. 

#3. Think with, not against. Negotiate with respect. You want the product; they want the sale. Any negotiation might turn into an us-against-them scenario before it's over. Starting with this viewpoint guarantees you an unfavorable outcome.

#4. Overcome objections with out-of-the-box thinking. Virtually any obstacle within reason can be worked around. For example, upfront money versus length of the contract, buyout versus renewals, immovable clauses versus additional language added as an addendum.

#5. Define the agreement zone. While staying away from "ranges" is generally a good rule, both parties should preempt roadblocks with defined go-zones. Have a goal defined, and hit it.

#6. Build trust. Nothing will devalue a contract negotiation quicker than agreeing to a deadline to sign or the next step and missing it. Their team has limited resources as well. Build a good rapport.  

 

*Note: we are not able to give legal advice.

Would you like more information on the negotiation process?

It doesn't have to be a multi-million dollar core contract. Let us prove our worth. Send us a few contracts and see what we can do. No savings = no invoice, no contingency fees.