Negotiation is everyday business bread. It’s everywhere – in meetings with clients, discussions with suppliers, or interdepartmental agreements. Often, negotiations determine whether a project ends in success or becomes a costly failure and a missed opportunity. Yet in many companies, negotiations are still treated as improvisation rather than as a process based on a set of best practices and negotiation standards that can be prepared, developed, and improved. And the difference is huge – companies that follow proven standards not only manage to protect their margins and close deals faster, but also build much more lasting relationships with partners.
Global research leaves no doubt. Companies that have implemented consistent negotiation standards increased their net income by more than 40% on average. Those that acted intuitively and without a plan lost up to 60% of potential profits. That’s hard evidence that negotiation is not a side aspect of business – it’s the foundation.
“Concrete data shows that companies often struggle with a structured approach to negotiation. They often pay for their lack of preparation – and dearly. A lost contract, reduced margin, sometimes even reputation. It really costs millions. Basing negotiations on the intuition and experience of individual employees is a straight path to serious financial losses,” emphasizes Jacek Słoma, a negotiation expert at Scotwork.
The foundation of success
The biggest problem remains preparation. Most managers admit that it’s the most important stage, but in practice, it often boils down to gathering a few basic pieces of information. Research conducted on over 6,000 negotiators shows this clearly: only half actually sit down to prepare, and just one in four is able to clearly define goals and formulate questions for the other party. The situation is even worse when it comes to having a backup plan – more than 80% of negotiators don’t have one at all, and 85% don’t even check what their partner actually wants. The result? Most meetings start in chaos, and negotiations quickly spiral out of control.
“Let’s be clear: ‘preparation’ does not always mean being ready for the conversation. The issue isn’t just that only half of managers prepare – it’s that many do it the wrong way. Proper preparation is not just about collecting data, but analyzing it and using it effectively. Without that, negotiations become a lottery,” adds Jacek Słoma.
Preparation includes analyzing goals, setting priorities, and making decisions: what can we give up, and what is non-negotiable. It also involves managing information skillfully – knowing what data to gather, what to disclose, and what to keep to yourself. A concession strategy is also essential – thinking through what we can offer and what we expect in return. Only such an approach gives control over the conversation and allows for conscious management of its flow.
“The negotiation arena is not a stage, but a space where parties can reach an agreement. The better prepared we are, the more control we have over that space,” emphasizes the expert.
Order in negotiations
A developed negotiation system is simply a set of standards and best practices that apply across the organization. Everyone uses the same tools, speaks the same language, and doesn’t waste time reinventing the wheel – they simply draw on the experience of past negotiations. As a result, the approach is predictable, repeatable, and not based solely on one person’s intuition, but on proven organizational principles.
“Companies that have implemented formal negotiation standards not only close conversations faster but also defend their margins more effectively and build stronger partner relationships. Experience shows that in cases where negotiations used to drag on for a year or more, after streamlining the rules, three-quarters of contracts are concluded in under two months,” notes the expert.
“But negotiations aren’t just about numbers and margins. Increasingly, they’re about relationships – about understanding the other side’s needs, aligning with their goals, and building trust. Structure doesn’t limit that – on the contrary, it provides a sense of clear rules, which greatly facilitates long-term cooperation,” says Jacek Słoma.
An investment that pays fff
Clients today are better prepared than ever. Reports show that most of them do their own research before meetings. This means the other side often comes to the negotiation table armed with solid arguments and expectations. A negotiator who relies only on intuition gives up the initiative before the first question is even asked. That’s why it’s so important to stay one step ahead – and that’s only possible by implementing negotiation standards, clearly defining principles, and equipping teams with negotiation skills.
“The client comes prepared, and you improvise? That’s a fast track to failure,” says Jacek Słoma. “Lack of a plan in negotiations means losses: lower revenues, weaker reputation, and poorer partner relationships. A plan delivers the opposite – higher profits, shorter talks, stronger margins, and more durable relationships. Today, with demanding clients and increasing competition, a professional approach to negotiation is no longer an option – it’s a condition for survival and competitive advantage.”
Sources:
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Huthwaite International – Negotiation performance (2022)
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Scotwork – We surveyed 6,600 salespeople and this is what we found
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Scotwork – Negotiation statistics
