Most negotiators greatly underestimate the time required to plan for any business negotiation even though this is the most important part of business negotiation best practice.

Using your negotiation skills to understand the negotiation environment is a great place to start preparing for negotiations.

The key elements to consider are:

- What is the nature of the transaction in terms of risks involved, the cost and the complexity of the transaction?

- Competitive analysis: What is the current position of the market and what choices do the other side have available? We will deal with a sole supplier differently than those in a competitive market.

- Is it a single transaction or should we consider securing a long-term positive relationship that creates opportunities for future trade?

- Have we concluded any transactions with the other side in the past and what is their most likely approach to concluding business?

- How experienced are the negotiators on the other side of the table?

- What cultures will be represented and what are the local traditions?

- Who are all the groups & individuals concerned in the negotiation and what is the decision making process? A diversified style is required as final decision makers will certainly be interested in Return on Investment and increased revenues & margins. The final user who looks for enhanced productivity and efficiency will find the financial elements almost completely irrelevant.

Almost any negotiation training course will highlight the importance of setting formal deal objectives.

If we fail to plan and prioritise our deal objectives we put ourselves at risk of being exploited and/or ending with a sub-optimal agreement. Whether you are engaged in negotiation on the sales or purchasing side, think about the following elements when planning for a negotiation:

- Price and payment, Key obligations, Delivery, Warranties, Intellectual property and Risks.

Price and Payments: The competition and the complexity of most business transactions demand finding methods to create additional value and to move negotiation from positional bargaining to mutually beneficial and creative joint problem solving. Professional buyers are not requested with getting the cheapest solution but rather with securing their organisations with the cheapest total cost of ownership, which is composed of things like:

- Acquisition costs, Maintenance costs, The cost of use, Support costs, Supplier performance criteria, Delivery, Product quality and Client Support. (These concepts are covered in most purchasing training programmes).

If we are able to minimize the other side's costs in the entire life cycle of the product, solution or service and simultaneously provide value for money, we are in a better position to find common ground.

Key Obligations: Ensure your product and services are defined and reflect your priorities. Include all the relevant quantities and specifications.

Delivery: How key are the delivery timelines and what happens if the delivery doesn't take place as agreed?

Warranties: In order to preserve trust and credibility make sure that you deliver any promises.

Intellectual property: Carefully negotiate IP ownership rights and think about the following factors:

- Which party is paying for the Research and Development?

- Could the research and development be used by competitors to your disadvantage if you don' t own the IP? How can you stop competitors to use the same IP?

Risks: The best way to manage exposure is to include the factors in a contract. Cultural consideration is very important. In Asian countries the goal of negotiation is not a signed contract. In China, unforeseen events are settled through the relationship.

Analysing the above factors are crucial in preparing Concession Strategies that will assist you to leverage maximum value from trades and in planning meetings optimally.