Win-Win Negotiation: A Must-Have Skill for SMEs

Admin Kapook · · upskilling
Win-Win Negotiation: A Must-Have Skill for SMEs

Four principles from Getting to Yes, preparing your BATNA, and how SMEs can negotiate with suppliers, big customers and landlords, with sample lines.

One morning your raw-material supplier calls to announce a price increase. That afternoon a major customer asks for another 30 days of credit, and in the evening the building owner messages about renewing your lease. For SME owners, negotiation is not an extra skill; it is daily work. Negotiating well protects both profit and relationships. Negotiating poorly can cost you both without you noticing.

What win-win negotiation is

Good negotiation is not "I win, you lose". It is finding an agreement where both sides get what matters most to them. The reason is simple: in business you deal with the same people again and again. If the other side feels taken advantage of, next time they will not cooperate, or they will look for payback elsewhere. Win-win does not mean giving in to keep the peace. It means standing firm, politely, on what matters to you and being flexible on what matters less.

Four principles from Getting to Yes

Getting to Yes by Roger Fisher and William Ury, members of the Harvard Negotiation Project, sets out four principles of principled negotiation that SMEs can use right away.

1. Separate the people from the problem

If a supplier delivers late, deal with the problem, not the person. Instead of "You are completely irresponsible", try "This delivery was three days late. How can we plan shipments so it does not happen again?"

2. Focus on interests, not positions

Ask why they want something. Example: a customer says "You have to lower the price." You keep asking and learn their budget is tight only this quarter. The answer may not be a discount but splitting payment into two instalments.

3. Invent multiple options

Do not lock yourself into one path. Before negotiating, prepare at least three options. If you will not cut the price, could you increase volume, extend credit, add after-sales service or bundle products?

4. Use objective criteria

Refer to data, not feelings. For example: "Quotes from two other suppliers fall in this range, so we are offering this price because..." Data gives your proposal weight and reduces emotional arguments.

Know your fallback (BATNA)

The same book recommends preparing a BATNA, your best alternative if no agreement is reached, such as a backup supplier you have already spoken to. The clearer your alternative, the less you need to accept a bad offer out of fear of losing the deal.

Three situations SMEs negotiate often

With suppliers

Trade what they value for what you need, such as larger orders in exchange for a lower unit price, or a long-term contract in exchange for longer credit terms.

With major customers

Do not cut the price immediately. First ask: "If we can adjust the price, could you increase the order or sign a longer contract?" Every concession should get something back.

On rent

Most landlords want stable tenants. Offer a longer lease in exchange for better rent, or ask for a rent-free fit-out period. Before signing a lease or long-term commercial contract, have a legal professional review the terms.

Every time you give something, ask what you get in return.

Common mistakes

If talks stall, read Handling deadlock when negotiations stall, and see techniques suited to the Thai context in Negotiating in Thai culture.

How to start practising

  1. Pick one upcoming negotiation
  2. Write down what you want, what the other side probably wants, and the lowest point you can accept
  3. Prepare three options and your BATNA
  4. After the conversation, send a written summary of what was agreed the same day

Recommended courses on Plants.work

Negotiation is a skill you can practise. Start with a small deal this week, and you will feel more confident when a big one comes along.