Top 5 Tips to Negotiate Legal Business Contracts
You can avoid costly arbitration and disputes by getting the contract right away.
Negotiating legal agreements can be frustrating and time-consuming. However, it is important to remain consistent and focus on the end result. We have compiled some tips that will help you to navigate this process.
Establish priorities and goals
The best training courses in contract negotiation will tell you that it is unlikely you’ll get everything you want, no matter how extraordinary you may be. It is important to set clear priorities before you start the negotiations.
Ask yourself: What are the most important outcomes? What stipulations would you be willing to ignore?
You can concentrate on the most important battles by setting priorities. These issues should be brought to the forefront. If you are not able to focus on them, it is okay to backtrack on less important issues.
You will lose a lot of energy if you try to win every detail. This will lead to frustration for both sides.
Divide the discussion into smaller parts
Discussions will be hampered if there is no agreement on a large contract covering many issues. These obstacles can often cause a stalemate or even the disintegration of talks.
In order to avoid unnecessary deadlocks, skilled negotiators recommend breaking down issues so that you can discuss each section of the contract in phases. Once you have reached an agreement on one side, you can move to the other, moving closer towards the goal.
Learn about the expected outcomes
It is important to learn as much as you can about the people and businesses that sit across the table.
Do some research on the other side to discover their motivations, interests, and pain points. You can identify areas that can be leveraged by learning more about the other side. Take, for example:
Communication. Communication can be improved by learning more about your counterpart. You can also find common interests and have small talks to lighten the mood.
Style – Researching the negotiating style of your opponent can help you plan your strategy and increase your chances for success.
Distinguish between people and emotions
Contract negotiations can be intense, fraught with emotions, rising tempers and high-stakes. It is important to remember that these negotiations are business and it is best not to bring emotions into the discussion.
Your judgment may be clouded by personal feelings or thoughts, which can lead to poor progress in discussions. Instead, focus on the facts.
Also, it is important to keep your emotions under control and stay calm during negotiations. Talks can be made more efficient if everyone is able to keep their heads down and communicate clearly.
If either party seems to be getting too excited or enraged it is best to call for a time out to stop the situation spiraling out of control.
It can be difficult to keep your emotions under control. You can practice techniques like:
Deep breathing can signal your brain that it is time to calm down
Allowing your brain to think in a different way and taking a moment to reflect on your thoughts is a good idea.
Physical activity can stimulate endorphin release
Do not rush the process
Rushing through negotiations could lead to unavoidable concessions or hasty decisions that can affect your ability to run your business over the term of the contract. It’s important that you take your time to make sure you understand every step.
You might also consider creating a draft document so that all parties can review it. This will ensure that everyone is on the same page about the terms and conditions of the contract.
If possible, control the discussion by setting the agenda. This will allow you to control the pace and timing of any issues being discussed. Be careful not to slow down the discussion to the point that it frustrates the other side. To gain concessions, slowing down proceedings can be an option if you realize that the other side is under pressure.
Concluding better contracts
You should have clear goals and break down the terms of the contract so that you can talk about each section separately. Next, work at a moderate pace through all issues. Take the time to learn more about the other side.
Keep emotions out of discussions. It is possible that you will not be able to manage your emotions well the first time. Therefore, it is worth practicing and rehearsing until the skills are mastered.