Contract negotiations are the least fun aspect of any business development strategy, but it is the most important. Once the details of the deal have been finalized, it is down to putting it all on paper and signing on the dotted line. But this often proves to be the most difficult part of any new client relationship. Both parties are keen to protect themselves, and rightfully so, but how do you negotiate different key points of your contract? What must be included for your safety, and theirs? We’ll dive deeper into the world of physical security contract negotiations.
Analyze Your Market
Analyzing your market is key to negotiating better contracts for your physical security company. A SWOT analysis can help you identify strengths, weaknesses, opportunities, and threats within your marketplace. Market research is essential for understanding your competition and the services they offer, what they charge, and where they are located. Proposal analysis ensures that the final contract meets all necessary requirements and considerations.
Collaboration is also necessary when it comes to negotiation. When approaching a potential partner or customer, be sure to seek out someone with the right connections who will work with you to maximize profits.
Research Your Clients
Researching your clients is one of the most important aspects of negotiating better contracts for your physical security company. Knowing the ins and outs of their needs and desires can help you produce a more tailored agreement that meets their needs and protects your own interests as well. Here are five tips to consider when researching potential clients:
- Do a Property Walk Before You’ve Won the Contract: Get an idea of the job’s size and scope and any potential challenges or concerns you may need to address to deliver quality services.
- Gather Pricing Information: Gather pricing information from multiple vendors so that you can effectively negotiate competitive prices with your customer.
- Assess Whether the Solution Considered Will Work for Your Client: Understand if the solution being proposed will meet all the requirements of your client’s business, including compliance standards.
- Separate the People from the Contract: Negotiate on the merits of each proposal, not on personal relationships with key stakeholders within the customer organization.
- Respond to Threats Effectively: When faced with threats such as lawsuits or negative publicity, remain professional and ensure that all communication is respectful and focused on finding common ground to reach an agreement beneficial for both parties.
Identify Your Unique Selling Points
Identifying your unique selling points (USPs) is an essential part of doing business and staying competitive in the physical security industry. Your USP is the distinguishing factor that sets your company apart from thousands of others. Developing your USP requires a two-step process: first, identify your niche, then excel in it.
Having a strong understanding of what makes you different from the competition will help you stand out and make your brand more recognizable. To do this, research what sets you apart and create a comprehensive list of advantages you offer that other companies don’t. You can also use surveys or customer feedback to gain insights into why customers prefer your services over others.
When discussing sales with potential buyers, it is important to be aware of their negotiation tactics. Coach your team to recognize strategies like positional negotiation and use effective counter strategies when needed. Role playing sports contract negotiations in front of the class can be an effective way to illustrate these concepts in practice.
USPs have helped many companies succeed and they can help you too when marketing yourself for promotions or finding new clients. Embrace them by having a clear Code of Business Ethics that defines what sets you apart as a company and reinforces its importance among employees. Keep it up-to-date by issuing new editions every year so everyone stays on the same page about what makes you special.
Take Advantage of Technology
Using technology can be a fantastic way to help your physical security company negotiate better contracts.
- Leverage any existing security technology you have in-house to give yourself an advantage during negotiations.
- Create a good contract template for your business and use it whenever possible. This will help ensure that all your contracts contain the same level of detail, clarity, and protection for both parties.
- Learn how physical security technology can improve guard management operations and increase accountability by automating repetitive tasks.
- 4. Increase your efficiency by taking full advantage of existing technologies, making sure you are accountable for all the risks associated with them.
Outline the Terms of the Contract
Outlining the terms of a contract is an important part of negotiating better contracts for your physical security company. This process involves two or more parties discussing the terms of the agreement before signing and making it official. When outlining the contract, it is important to clearly state who the parties are, their full names, and any other pertinent details. Additionally, you should cover essential elements such as goals and benefits, provisions of applicable laws, understanding key negotiating terms in a contract, integrating software tools used in negotiations, allocating costs to different objectives, and considering risks.
Using this outline can help you negotiate a better contract that is tailored to your physical security company’s needs. In addition to outlining specific terms and conditions in detail, consider these tips: create a clear agenda before negotiations begin; identify both parties’ interests; understand the decision-making process ahead of time; break down larger issues into smaller points; have good communication skills; be aware of deadlines; remain flexible; be aware of cultural differences when dealing with different countries; research the other party well beforehand; set parameters for an optimal outcome; have backup plans ready in case things don’t go as planned; and always aim for win-win solutions.
Listen and Respond to Concerns
For physical security companies, listening and responding to stakeholders' concerns is essential to negotiate better contracts with clients. Gathering facts on technical issues and responding to agency-level questions can help you demonstrate your expertise and gain the trust of potential clients.
By understanding the different negotiating terms used in contract agreements and responding promptly and effectively when faced with threats or demands, physical security companies can ensure that their contracts are beneficial for everyone involved.
Know When to Walk Away from a Deal
It can be difficult to know when to walk away from a deal, especially if it feels like you are so close to getting the terms you want. However, walking away can often be the best decision for your business overall. Here are some tips on how to know when it is time to walk away from a negotiation:
- Understand what you want and are willing to accept in advance. Knowing your bottom line before entering negotiations will help ensure you don’t get too attached to a potential deal.
- Game plan: make sure that you have a strategy in place and understand the various aspects of the negotiation beforehand so that you can make informed decisions as things progress.
- Know what alternatives you have: understanding market rates and alternatives available will give you more power during negotiations, as it will show that there are other options available if the current negotiations fail.
- Develop negotiating skills: practice makes perfect when it comes to negotiating; take courses or attend seminars on negotiation tactics and strategies so that you feel more confident going into negotiations.
- Have confidence: walking away from a deal is not always easy but it is often necessary; having confidence in your ability to negotiate and knowing when to end negotiations is key to success.
Ensure All Parties Are Satisfied with the Outcome
Successful negotiations require compromise from both sides for an outcome that is beneficial for all parties involved.
Follow Up & Finalize Agreement
After the negotiation process is complete, a contract must be signed, and any payments are required to be made before the agreement can go into effect.
Negotiating better contracts for your physical security company can be a daunting task, but with the right preparation and strategy, it is possible. To ensure that your contracts are the best they can be, evaluate yourself and the other party to get an understanding of what is important to each. Explain to your team the importance of negotiating and emphasize that it is okay to ask for more in a contract. It is also helpful to use plain language when writing contracts so that everyone understands them clearly. Additionally, try to design an agreement that fosters cooperation between both parties and creates a unified appearance during negotiations. Finally, if disagreements arise during negotiations, be sure to resolve them in a manner that still allows for team unity and cooperation. With these tips in mind, you can make sure your physical security company has the best contracts possible.