Here is an all too common sales scenario: a client is price-sensitive, and several competitors offer a similar product at a lower price.
What is the right approach in this situation?
Some might turn away from the deal, seeing no way around the price objection. A skilled negotiator won’t perceive it that way, though. They’ll understand that value is much more than price.
Instead of focusing on the objection, they’ll shift the conversation toward long-term benefits that the client will receive. This could be everything from personalized onboarding to a dedicated account manager.
This is the power of non-monetary and service value.
Here at RED BEAR, we call them alternate negotiables. When used correctly, they can differentiate a company from the competition and demonstrate a commitment to the client’s success.
Let’s uncover the role these alternate negotiables play in sales.
What Are Non-Monetary Negotiables?
Not everything is about price.
When your team shifts away from a purely price-focused perspective, they gain insight into every other value driver included in a deal.
“When your team shifts away from a purely price-focused perspective, they gain insight into every other value driver included in a deal.”
It’s called non-monetary value. As you can imagine, this broad term covers quite a few types of negotiables. Here are a few you might see in a sales negotiation environment:
- Flexible payment terms
- Customized solutions
- Exclusive access
- Expedited delivery
Some negotiables deliver additional service value:
- Customer service assurances
- Technical support
- Training
- Other post-sales benefits
Non-monetary negotiables, or alternate negotiables, play an essential role during negotiations. In the best circumstances, they act as Elegant Negotiables — high-value, low-cost items for your company that are desirable for the other party.
Think of benefits like extended warranties or priority support — items that don’t put too much strain on your bottom line while still delivering value.
But how do you know what to offer and when? It boils down to asking open questions, active listening, uncovering needs and wants, and effective concessions planning. When your team has actively listened and comes ready and prepared with a rock-solid strategy, they understand what negotiables will pull interest and when to offer those items for the most efficient deal-making.
Where to Find Alternate Negotiables
While proper negotiation planning is essential, a lot happens in the moment that can present opportunities for negotiators. At RED BEAR, we use a negotiation methodology based on real-world environments and decades of experience.
Part of what makes our training stand out is a focus on the fundamentals. Take Manage Information Skillfully, which is one of six Negotiation Principles.
High-quality information is a valuable resource.
Skilled negotiators are careful in what they reveal while also trying to uncover information about the other party. In uncovering non-monetary value, they might use the Ask Open Questions Negotiation Behavior to dig deeper into an objection to price.
Carefully listening to the response, they might learn that the company has had trouble with late deliveries in the past. Instead of lowering prices, they could offer assurances on delivery schedules to help address this pain point. That’s the power of alternate negotiables.
How to Communicate Non-Monetary Value Effectively
Once you understand what alternate negotiables are on the table, it’s time to communicate their value to the other party.
Remember that non-monetary and service value can come in the form of everything from time savings and increased efficiency to risk reduction and prioritized customer service. But, regardless of how high value these items appear at first glance, your team often needs to put in the work of making them feel beneficial to sell them.
Here are a few strategies to communicate that value:
- Test and Summarize: One of the Negotiation Behaviors, this strategy leverages active listening and relationship building. This involves articulating the other party’s needs and wants in your own words. Here, you might include a non-monetary negotiable to address specific concerns.
- Propose Conditionally: Another Negotiation Behavior; this strategy utilizes healthy tension to unlock the power of creative thinking. Here is where you might propose an alternate or even Elegant Negotiable to move the discussion forward in a positive direction.
It’s important to develop quantifiable outcomes. Always translate non-monetary value into tangible benefits, like:
- Time savings
- Increased efficiency
- Risk reduction
Ask yourself, “How does this solution address the client’s pain points?”
Then frame your value proposition in these terms and try to use creative storytelling to illustrate the real-world impact of your non-monetary offerings.
Another key element of effective communication is dealing with objections.
In the planning phase of negotiation, try to be proactive and address potential concerns and objections about the value or feasibility of alternate negotiables ahead of time. Back up claims with hard data, testimonials, or demonstrations.
“In the planning phase of negotiation, try to be proactive and address potential concerns and objections about the value or feasibility of alternate negotiables ahead of time. Back up claims with hard data, testimonials, or demonstrations.”
Positioning is key here. Frame your alternate negotiables as something that sets you apart from the competition. In the end, this approach aims to satisfy needs over wants, diving deeper to uncover the root causes of certain problems rather than focusing on superficial fixes.
How to Leverage Service Value in Negotiation
It's important to set the tone early in sales negotiations. Skilled negotiators understand this and try to balance the collaborative and competitive approaches, what we call the dimensions of negotiation, to find areas of creative opportunity.
Alternate negotiables can serve this purpose, offering value and helping navigate the inherent tension of a negotiation This can lead to collaborative problem-solving. But having them in play early is critical.
For example, presenting service value in the form of assurances on prioritized customer support can address current needs and build trust and credibility from the onset. When you showcase assets like your company's exceptional service, expertise, or post-sale support as critical differentiators, you highlight your proposals' unique value.
Think of your value proposition as a blank canvas. It's a way to help your clients visualize how non-monetary offerings address specific needs and create value.
If you can leverage active listening and align the value proposition with the client, you can further demonstrate your deep understanding of both their business and their challenges.
Cultivating a Value-Centric Sales Culture
Skilled negotiators understand the value of alternate negotiables. But, going from no established process to an effective strategy that gets results takes time, resources, and energy.
It all starts with the identification of these alternate negotiables.
This begins early in the sales process. Sales team members should identify and document non-monetary or service value for each client. They can even integrate these findings into a CRM tool for easy tracking and analysis. With this information in hand, they can craft powerful value propositions in the future.
Of course, this task is only the beginning.
Training is also another essential element. Here at RED BEAR, our mission is to empower individuals and transform them into world-class negotiators. While you’ll learn all about the foundational elements of effective negotiation, you’ll also learn how to cultivate a value-centric sales culture within your organization.
However, training does not end when the workshop is over. Ongoing training on value-based selling, negotiation skills, and understanding customer needs is essential.
Much like our negotiables, a successful sale shouldn’t be judged solely on price.
Align sales incentives with long-term customer satisfaction and repeat business, not just short-term deal closures. Master these approaches, and your sales team won’t just be closing deals; they’ll be building relationships that offer value for years to come.
This is no secret, either. Major companies understand the value of long-term relationship building. Just take Microsoft for example: 95% of its commercial revenue flows from established partnerships.
Get Sales Ready with RED BEAR
It’s important to shift the focus of your sales team away from just price and toward value. Non-monetary and service value serves as a creative tool for negotiators, a way to break through impasses and address client needs over superficial wants.
This strategy is at the heart of the RED BEAR negotiation methodology.
That’s exactly why over 45% of the Fortune 500 leverage our negotiation training. In short, it gets results.
Regardless of the industry or negotiation environment, having the tools to understand and uncover underlying needs and deliver value that meets the moment is the key to successful deals.
For more information on our workshops, be sure to connect with the team today.
