Farmer guide on negotiating deals

Improving negotiating skills could help many farmers strike a better bargain. Robyn Vinter gets some pointers from experts

In a recent article Farmers Weekly highlighted how beef producers could earn more by negotiating in a tight market. But there are opportunities for many to hone their deal-making skills in other sectors.

It may be a cliché but Brits have reservations about talking about money, says negotiation expert Steve Jones, managing director of cost reduction consultancy Resharpen.

First, don’t think of it as negotiating, but rather persuading the other side around to your point, says Mr Jones who has trained buyers at major supermarkets.

Successful negotiators follow the cultural norms of haggling, he says, such as asking for more than they want from the start.

Prepare

“Usually people say the same sorts of things like ‘how much do you charge?'”

It’s a good idea to practise answers and commercial arguments in response, says Mr Jones – even rudimentary pushbacks can be successful. Look out for what he calls weak language on either side, for example – questions like “can you reduce the price?”

“Think about responding with another question such as ‘why is that important to you?’ If they say it’s too expensive, ask what they are comparing it with.”

This can help discover how the other party might compromise. Having confidence is important too – but negotiating is not always about money, he says.

“Good negotiators introduce other elements, for example payment terms or delivery,” he says. “Nothing is for nothing – make sure if you give something, you get something in return.”

Preparation is key, particularly when negotiating by phone. Treat phone negotiations like a face-to-face meeting, making an appointment to speak to someone later on the phone, allowing time to prepare, he suggests.

Phrase it well

How farmers phrase discussions can also influence the result. “Don’t say what you want before you give an explanation of why it is worth it because already they’re thinking of an argument and not listening to your justification.

“Instead, say something along the lines of ‘taking into account current prices, I think it is worth X pounds’. Once you’ve made your case, do not budge until you hear theirs. If they say it’s too much, don’t then lower the price, make sure you get their offer before you start compromising.”

Numbers should not be given without a reason, he says, because explaining why the offer is fair is part of persuading the other person to see your point of view. Conversely, do not ask the other person to explain why their offer is fair.

“Don’t ask how they justify their offer, or even talk about their price if you can, as it will only fix it in their mind,” he says.

A frequent mistake is to ask if that is their best price, says Mr Jones – there’s only one answer to that and it is “yes”.

Aggressive negotiators base their strategy entirely on the other person’s reaction, says Mr Jones. If someone gives a price and the other party does not protest, aggressive negotiators will spot that, and use it to weaken the other side’s position.

Farm management consultant Alistair Gibb of Cedar Associates agrees that good negotiating often takes time and planning and also requires open-mindedness.

Antagonistic negotiations tend to be short-term, one-off situations; long-term relationships need to be more synergistic, he says.

“You need to understand what they want and they need to understand what you want. These are the most successful negotiations, and often you walk away with more on both sides.”

Collaborating in itself could improve negotiating, allowing sharing of skills, for example with farmers taking on different roles within a co-op to the benefit of everyone.

Lack of time can be a big factor in failure to negotiate successfully, says Mr Gibbs. However, some farmers may simply not negotiate with their suppliers or customers because they have built up a good long-term relationship.

“There’s an element of negotiation in managing staff, or if a disagreement arises in the family. Everyone should learn it, no matter what level they are,” advises Mr Gibbs.

Mr Gibb is presenting farmer workshops on communication skills, decision-making, time management, negotiation skills and succession planning. Funded by the Rural Development Programme for England and by AHDB, they run from 19 September to 30 January in West Yorkshire, Stafford, Cirencester and Bury St Edmunds. Places cost £15+VAT (half day) and £30+VAT (full day). Call Sarah Akerman on 0247 647 8955 for more information.