Myers Barnes Blog

Blog Archive for August, 2012

Preparing To Negotiate A New Home Sale, Part 2: How?

Categories: New Home Sales, New Home Sales Training | Posted: August 27, 2012

In my last blog post, I explained why a new home salesperson needs to prepare to negotiate, and not just “wing it”. If you want to get the best deal for your builder and give the customer the value he is seeking, you need to prepare your negotiation strategy.

Here are five key steps to take when preparing to negotiate a new home sale:

  1. Know the outcome you want. Get it clear in your mind what you expect from this process. Of course, the sale is the optimum goal, but you also need to maintain the integrity of the builder, developer, and the property itself, as well as the other homeowners who have equity that could be compromised, depending on the outcome of this deal you are about to negotiate.
  2. Determine the concessions in advance. Know the limits before you begin negotiating. What incentives can you offer? How much elasticity do you have with the price? If you don’t establish boundaries in advance, you are likely to give up too much during the negotiation. Make a list of add-ons, incentives, and concessions that you feel comfortable offering, and don’t exceed them.
  3. Know your buyers. Every buyer has his own agenda, based on his desire for the home, passion for negotiating, perception of value, and long-term goals. In order for you to present the deal that will best suit your buyer, you need to understand this customer’s objectives. What do they want and why? Do you know what they need versus what they want? Be an active listener prior to the negotiation so you can gather the clues. Ask questions—the right questions that will lead you to a telling profile.
  4. Rehearse. Any good performance is practiced in advance. Professional athletes train every day to do their best during the heat of competition when any flaw or failure affects the outcome. Performers rehearse so that when they are on stage, they deliver their best effort, seemingly without effort. The same goes for the new home salesperson. The negotiation process is your stage, your playing field. Rehearse your delivery—with a colleague, a friend, or a family member. Practice your techniques on other salespeople when shopping. The added practice will lead to a negotiation performance that is truly eloquent.
  5. Maintain the power to walk away. Although your desired outcome is to close a sale at the end of the negotiation process, this result isn’t necessarily always the best option. If your buyer feels you are committed to making a sale—as opposed to making a profitable sale—then you forfeit the control. Be prepared to walk away from the negotiation if the deal is unreasonable. Your ultimate goal is to make a strong deal for your builder, not appease the buyer. Respect your builder, the property, and yourself by maintaining the power to walk away.

Preparing to Negotiate A New Home Sale, Part 1: Why?

Categories: New Home Sales, New Home Sales Training | Posted: August 13, 2012

Do you enter into the negotiation process with a homebuyer, fully prepared to get the best value for your builder or developer? Or are you shooting from the hip, relying on your past experience to close the sale?

If you’re taking the second option, chances are that you are either not closing as many deals as you could be or you are giving up too much—and neither one is a successful outcome.

Successful negotiation is all about preparation.

Abe Lincoln observed, “If I had eight hours to chop down a tree, I’d spend six sharpening my axe.”

And Muhammad Ali said, “I run on the road long before I dance under the lights.”

Before you being the negotiation, recognize that both sides want something. Your buyer wants the home and you want to sell it to him. Your goal is to make that happen in such a way as both sides walk away feeling good about the final outcome.

Your customer walks into the room, armed with questions and probably knows the answers he wants. He also knows the deal he hopes to get from you. He has a list of add-ons and a price in mind.

Do you?

Are you prepared to counter his objections with a reasonable response? Do you know in advance what concessions you can make, if necessary, without killing the profitability for your client? Have you familiarized yourself with this customer so you are prepared to address his concerns? Are you confident that the compromise you are offering reflects the true value of the home?

Sure, you can shoot from the hip, but if your aim isn’t sharp, you might shoot yourself in the foot!

New Home Sales Training: Negotiation Skills Are an Acquired Talent

Categories: New Home Sales, New Home Sales Training | Posted: April 30, 2012

Sales is a profession, and just like any profession, it requires ongoing training. There is no end to what you can and should be learning. To call yourself a “professional” in this field, you need to do more than spend your days trying to close deals. You need to invest in your sales education.

One of the biggest training gaps I see among new home salespeople is in the fine art of negotiation. Now, they spend their days trying to convince people to buy a new home, and negotiating the deal is the linchpin to success here. Sure, they can close the sale, but did they negotiate the best price for the builder or developer? Are they making concessions too readily?

If you truly want to excel in your field, you need to learn more about the techniques involved in successful negotiation. Take a class. Read. Practice. Learn the secrets of successful negotiation. You’ve got to understand how to read the cues and be ready with intelligent, thoughtful responses. You should know in advance the limits of your incentives and concessions—and be prepared to hold tight to them rather than toss them out freely like beads at a Mardi Gras parade.

You should be so prepared before entering a negotiation that you masterfully guide it to the best outcome for your client. Shooting from the hip in a negotiation is like playing Russian roulette. There’s a pretty good chance you’re going to lose.