Is Everything Negotiable?

New start businesses, by their very nature, are frequently managed by inexperienced management teams.  School-leavers and graduates come equipped with enthusiasm and energy and can overcome problems that older, more experienced business people would avoid.  However they may often be working hard for long hours without realizing what benefits a little negotiation may bring.

Smart working demands that you understand the basic principle of human interaction.  If you deal with another person and they accept what you demand without arguing or looking for some sort of compromise, you may be losing money.

Consider a typical production facility.  Raw materials and components are delivered to one end of the plant.  The supplier and the delivery driver both have to make a profit but you don't have to pay for their walnut-lined boardroom and his Caribbean vacation with this delivery.

Warehouse space is expensive.  Make sure that hanging on to material stocks and redundant product is worth the cost per square foot.  There is always a way to make money from scrap, just check out Ebay.com.

The production machinery you use to convert the raw materials and components into product have to be purchased, maintained and replaced when they wear out.  The scope for saving money and time by making smart deals with your machinery factors to commission new and remove old equipment and with maintenance crews by insisting on minimum equipment downtime is worth exploring.

When you employ people and every year thereafter when you discuss pay increases there is a need to motivate but there is also a balance to be struck with releasing cash for growth.  The salary bill is normally the biggest one and logically has the scope for greatest waste or greatest savings.

Marketing and selling your products can be an expensive activity, especially if you get involved in trade shows and road shows.  Once again there are often deals to be done by sharing space or co-marketing.  Printers, trade journals and the media have periods where they are hungry for material to fill their order books or pages.  If you plan your marketing needs far enough in advance, you can take advantage of these lean periods.

Regional sales teams must pay for themselves.  If not, the regions are too small or the salespeople are not sweating their assets.  Agree tough but achievable targets and have the sales teams stretch to earn their full salary.

Staff restaurants should be self-funding otherwise you should only subsidize them to offset lost time if staff need to go off-site for a meal break and return late.

Finally, cleaning your offices is almost a commodity product but it may not have to be done every day or alternatively your staff could take more responsibility for the cleanliness of their workstations; explore the options.

Its official, the best kept secret in the business world is that absolutely everything is negotiable and the single most powerful tool for winning a negotiation is the ability to walk away from the table without a deal.

Information is for educational and informational purposes only and is not be interpreted as financial or legal advice. This does not represent a recommendation to buy, sell, or hold any security. Please consult your financial advisor.