Negotiation Skills for Entrepreneurs: Preparation That Creates Leverage

A reusable preparation routine that creates leverage

Leverage in negotiation rarely comes from talking faster or pushing harder. For entrepreneurs, leverage is usually created before the meeting: by knowing the market, mapping alternatives, defining variables you can trade, and walking in with a plan for your opening and your questions. The goal of this routine is to turn “I hope this goes well” into “I know what I can offer, what I need, and what I’ll do if we can’t agree.”

Preparation workflow (30–60 minutes)

• 10–15 min: Information gathering checklist (rates, benchmarks, alternatives, budget signals)
• 10–15 min: Define your variables (what can move vs. what cannot)
• 10–15 min: Trade-off map (prioritize and plan concessions)
• 10–15 min: Opening + questions (script your first 3 minutes and your discovery)

1) Information gathering checklist

Information is leverage because it reduces uncertainty and prevents you from negotiating against yourself. Use the checklist below to quickly gather “good enough” data. You are not trying to predict the future; you are trying to avoid walking in blind.

Market rates (what is normal)

• Comparable pricing: What do similar vendors/consultants charge for similar scope? Capture at least 3 reference points.
• Rate structure: Are market prices hourly, per project, per seat, per usage, retainer-based, or performance-based?
• Typical terms: Common payment timing (net-15/net-30), deposits, cancellation policies, and renewal practices.
• Seasonality and capacity: Are there peak periods where rates rise or timelines stretch?

Competitor benchmarks (what the other side can choose instead)

• Named alternatives: List 2–4 competitors or substitute solutions the other side might consider.
• Strengths/weaknesses: For each alternative, note one reason they might prefer it and one reason they might avoid it.
• Switching costs: Migration effort, training time, contract lock-in, integration work, or risk of downtime.
• Decision criteria: What do buyers typically optimize for in this category (speed, reliability, compliance, brand, price)?

Vendor alternatives (your options if this deal fails)

Entrepreneurs often under-prepare here. Your leverage improves dramatically when you can credibly say “no” because you have other paths.

• Alternative counterparties: Other suppliers, agencies, freelancers, platforms, or distribution channels you can use.
• Build vs. buy: Can you do it in-house temporarily? What is the real cost (time, opportunity cost, quality risk)?
• Delay option: Can you postpone the decision without major damage? For how long?
• Partial deal option: Can you start smaller (pilot) to reduce risk while keeping momentum?

Client budget signals (what they can pay and how they think)

Budget is rarely stated directly, but it leaves clues. Your job is to collect signals and then confirm them with questions later.

• Company size and stage: Headcount, funding, revenue, growth rate, hiring pace.
• Prior spend: What have they paid before for similar work? Look for job posts, case studies, procurement portals, or vendor reviews.
• Urgency: Deadlines tied to launches, compliance dates, board meetings, or churn risk often correlate with willingness to pay for speed.
• Stakeholders: Who signs? Who uses? Who blocks? Procurement involvement often signals tighter term scrutiny.
• Language cues: “We need this yesterday” (speed premium), “We’re comparing 5 vendors” (price pressure), “We need predictability” (terms/support matter).

Quick capture table

2) Defining your variables (what can move)

Most deals have more than one “price.” Entrepreneurs create leverage by negotiating multiple variables, not just the headline number. Start by listing every variable that could change, then mark which are flexible and which are fixed.

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Core variables to define

• Price: total price, unit price, hourly rate, retainer amount, minimum commitment
• Scope: deliverables, exclusions, number of revisions, usage limits, seats, locations
• Payment terms: deposit, milestones, net terms, late fees, prepay discounts, currency
• Timeline: start date, delivery dates, expedited options, dependencies, client responsibilities
• Support: response times, channels, onboarding, training, success check-ins
• IP: ownership, licensing, portfolio rights, reuse rights, open-source constraints
• Liability: caps, indemnities, warranties, limitation of damages, insurance requirements

Turn variables into “dials” with ranges

For each variable, define three levels: target (what you want), acceptable (still a good deal), and walk-away (not worth doing). This prevents improvising under pressure.

Practical example: turning “discount request” into variable trades

If a client asks for 15% off, you can respond with prepared options that protect value:

• Option A (keep price): “We can keep the current price and include onboarding + 60 days of priority support.”
• Option B (trade for commitment): “We can do 10% off with a 6-month commitment paid monthly via ACH.”
• Option C (trade for scope): “We can meet that number if we remove X deliverable and cap revisions at 2 rounds.”
• Option D (trade for cash flow): “We can do 12% off for full prepay.”

These options only work if you pre-defined which dials you are willing to turn.

3) Prioritizing issues using a trade-off map

A trade-off map is a simple way to prioritize what you value and predict what the other side values, so you can trade low-cost items for high-value returns. The aim is not to “win every point,” but to exchange concessions strategically.

Step-by-step: build a 2x2 trade-off map

Create a grid with two axes:

• X-axis: Value to you (low → high)
• Y-axis: Value to them (low → high)

Then place each variable (price, scope, terms, timeline, support, IP, liability) into the quadrant that best matches your current understanding.

How to use each quadrant

• High value to you / Low value to them: Protect these. Ask early. Don’t concede without getting paid back.
• High value to them / Low value to you: Use these as bargaining chips. Offer them in exchange for what you want.
• High value to both: Collaborate and problem-solve. Look for creative structures (phasing, pilots, shared metrics).
• Low value to both: De-prioritize. Don’t spend time here; bundle them.

Example trade-off map (B2B service deal)

Concession planning rule: never concede randomly

Before the call, write a short “if-then” list:

• If they ask for a lower price, then I ask for (prepay / longer commitment / reduced scope).
• If they ask for faster delivery, then I ask for (expedite fee / reduced scope / client resources).
• If they ask for broader IP rights, then I ask for (higher fee / limited license scope / attribution).
• If they ask for higher liability, then I ask for (liability cap / higher fee / narrower warranty).

4) Planning your opening and questions

Your opening sets the frame: what this deal is, what matters, and how decisions will be made. Your questions uncover the other side’s priorities so your trade-off map becomes accurate.

Plan your opening (first 2–3 minutes)

Use a simple structure: align → confirm goal → propose process.

Opening script (fill-in):  "Thanks for making the time. My goal today is to confirm what success looks like for [project/deal] and then walk through a proposal that matches your priorities.  I’d like to cover: (1) your timeline and decision process, (2) scope and success criteria, (3) terms and next steps.  Does that agenda work?"

Plan your questions (discovery that creates options)

Prepare questions that reveal constraints, priorities, and tradeable variables. Ask, then pause. Your goal is to learn what they value so you can trade, not guess.

• Priority questions: “What are the top 2 outcomes you care about most?” “If we could only optimize for one thing, what would it be?”
• Constraint questions: “What’s driving the deadline?” “What internal dependencies do we need to plan around?”
• Budget and structure questions: “How is this typically budgeted—capex/opex, monthly/annual?” “Is there a range you’ve allocated for this?”
• Decision process questions: “Who else needs to weigh in?” “What criteria will you use to choose?” “What’s the approval timeline?”
• Trade-off questions: “If we could move faster, would you prefer paying an expedite fee or reducing scope?” “Would you rather optimize for lower monthly cost or lower total cost?”
• Risk questions: “What would make this feel risky internally?” “What terms are non-negotiable for your legal/procurement team?”

Plan your first offer (anchored, justified, and flexible)

Your first offer should be tied to scope and value, not just a number. Build it as a package with options so you can trade without “losing.”

• Package 1 (Target): best fit for outcomes, strongest terms for you
• Package 2 (Middle): balanced trade-offs
• Package 3 (Entry): reduced scope or slower timeline, lower price

Each package should differ on at least two variables (e.g., price + timeline, or scope + payment terms), so the conversation becomes about choices rather than haggling.

One-page negotiation brief (fill-in template)

Use this template before any meaningful negotiation (client deal, vendor contract, partnership). Keep it to one page so it stays usable.

ONE-PAGE NEGOTIATION BRIEF  Deal name: __________________________  Date: ____________  Counterparty: _______________________  Your role: __________________________  1) Objective (specific outcome you want)  - Primary objective: ______________________________________________  - Why it matters (business impact): _______________________________  2) Information snapshot  - Market rate references (3): 1) __________ 2) __________ 3) __________  - Competitor/alternative options for them (2–4): ___________________  - Your alternatives if no deal (top 2): ____________________________  - Budget/urgency signals observed: ________________________________  3) Variables and ranges (Target / Acceptable / Walk-away)  - Price: __________________ / __________________ / __________________  - Scope (must-haves & exclusions): _________________________________  - Payment terms: __________ / __________ / __________  - Timeline: ______________ / ______________ / ______________  - Support: _______________ / _______________ / _______________  - IP: ____________________ / ____________________ / ____________________  - Liability: ______________ / ______________ / ______________  4) Trade-off map notes  - High value to me / low to them (protect): ________________________  - High value to them / low to me (trade): __________________________  - High value to both (solve creatively): ___________________________  5) Concession plan (if-then)  - If they ask for __________________, then I ask for _______________  - If they ask for __________________, then I ask for _______________  - If they ask for __________________, then I ask for _______________  6) Opening + questions  - Opening statement (2–3 sentences): ______________________________  - Top 5 questions to ask: 1) ________ 2) ________ 3) ________ 4) ________ 5) ________  7) Proposed offers (packages)  - Package A (Target): _____________________________________________  - Package B (Middle): _____________________________________________  - Package C (Entry): ______________________________________________  8) Decision and next steps  - Who signs? __________________  Timeline: ________________________  - Next step I want by end of call: _________________________________

Mini-exercise: convert “increase price” into specific asks and ranges

Vague goals create weak negotiation behavior (over-explaining, discounting, or accepting bad terms). This exercise turns “increase price” into a clear plan with numbers and trades.

Step 1: define the current baseline

Fill in:

• Current price: $______
• Current scope (3 bullets): 1) ______ 2) ______ 3) ______
• Current payment terms: ______
• Current timeline: ______

Step 2: choose a target increase and justify it with a driver

Pick one driver (not a long speech): increased demand, added capability, higher costs, faster delivery, stronger outcomes, or reduced risk.

• Target increase (%): +_____%
• Target price: $______
• Justification driver (one sentence): ________________________________

Step 3: set your range (target / acceptable / walk-away)

Convert the goal into a range you can negotiate within.

• Target: $______ (ideal outcome)
• Acceptable: $______ (still worth it)
• Walk-away: $______ (below this, change structure or decline)

Rule of thumb: if you don’t know your walk-away, you will discover it too late.

Step 4: create three “asks” (not just one number)

Write three concrete asks that support the price increase. At least one should be non-price.

• Ask #1 (price): “For this scope, the fee is $______.”
• Ask #2 (terms): “To hold that price, we’ll do ______ (e.g., 50% upfront, net-15, milestone billing).”
• Ask #3 (scope/timeline/support): “This includes ______ and excludes ______.”

Step 5: pre-write two trade options if they push back

Prepare trades so you don’t discount automatically.

• If they say “too expensive”: “We can meet a lower number by reducing scope (remove ______) or by changing terms (prepay/commitment). Which is better for you?”
• If they say “we need it faster”: “We can expedite for $______ or keep price and adjust scope to hit the date. What’s the priority?”

Worked example (fill-in style)

Suppose you currently charge $5,000 for a website landing page + copy + 2 revision rounds, delivered in 3 weeks, net-30. You want to “increase price.” Convert it:

• Target: $6,500 (because demand is high and you now include analytics setup)
• Acceptable: $6,000
• Walk-away: $5,500 (otherwise reduce scope)
• Ask package: $6,500 with 50% upfront, delivery in 2.5 weeks, includes analytics + 2 revisions
• Trade option: $6,000 if delivery is 3.5 weeks or if revisions are capped at 1 round

The key is that you are no longer “trying to increase price.” You are proposing a structured deal with ranges and trades.