Negotiation occurs between spouses, managers and staff, employers and employees, professionals and clients, within and between organizations and between agencies and the public. Negotiation is a problem-solving process in which two or more people voluntarily discuss their differences and attempt to reach a joint decision on their common concerns. Negotiation requires participants to identify issues about which they differ, educate each other about their needs and interests, generate possible settlement options and bargain over the terms of the final agreement. Successful negotiations generally result in some kind of exchange or promise being made by the negotiators to each other. The exchange may be tangible (such as money, a commitment of time or a particular behavior) or intangible (such as an agreement to change an attitude or expectation, or make an apology).

Negotiation is the principal way that people redefine an old relationship that is not working to their satisfaction or establish a new relationship where none existed before. Because negotiation is such a common problem-solving process, it is in everyone’s interest to become familiar with negotiating dynamics and skills.

It is extremely important to develop a climate and attitude of “win-win” while negotiating. One party can win more than the other, but neither would see themselves as having lost because negotiation is primarily an exchange of satisfactions. Here are 9 keys to successful negotiation:

• Good Communication – it leads to increased understanding.
• Areas of Negotiation – price, control, power, position, recognition, etc.
• Values Vary – priorities, importance, and moral issues.
• Issues – have the real concerns been uncovered?
• Non-Verbal – ability to observe actions, body language, attitudes, and sincerity.
• Questioning – in-depth probing determines win/win outcome.
• Information – the party with the most information has the advantage.
• Patience – don’t let the other party rush you; control emotions on both sides.
• Planning – detailed planning gives a negotiator options and the ability to predict offers. Foresighted planning protects against making concessions.

1. Are you doing what you love, or just doing something you’re good at?  A desire to get away from the regular working world can be a good motivation to work for yourself, but you have to be excited to get up in the morning to do what it is you have chosen to do for a living.

2. What is it you are planning to do?  What niche is it going to fill?  Is there a need for what you can provide?  Will the market bear another entry?

3. What technical skills or talents do you have?  Just being able to do something may not be marketable enough to convince customers or financiers that you are a good financial investment.

4. Who are your competitors in your chosen profession and how are you going to do it better?  Why should customers come to you?  What do you have to offer that no one else does?

Once you are satisfied with the answers to these questions, it is time for the decision of what kind of business structure you will use. Will you be a sole proprietor, responsible for every facet and the penultimate authority as to how to run the business?  Will you enter in with a partner, the better to share the cost and workload, but also the profits and the business decisions?  Perhaps the decision will be made to incorporate, with its financial safeguards but more complex and costly structure?  At this stage, legal advice is recommended, if only so that you fully understand the advantages and disadvantages of your chosen structuring plan.  Many lawyers will provide a free or reduced-rate primary consultation, though often not more than an hour.  When the structure is finalized, a name for the business should be decided upon, if not already having been done so in advance.  It should be easy to remember, avoid initials and single letters (B & L & R, Inc. will be difficult to remember for customers) and try to say something about the business (Bob’s House of Hobbies is easier to remember and spell).

Next, a business plan is a vital step in laying out all these topics and proposals in a standardized format.  A good business plan serves as a formal statement of the new company’s goals, financing, structure and legal considerations.  It acts as a “resume” to prospective investors and is the primary documentation they will use to evaluate whether or not your business will be worth investing into.  It also provides the proprietor(s) with a chance to see the workings of the new business in black and white.  A basic business plan should at the least contain a balance sheet, income statement and statement of cash flow, as well as a proposed financial budget for the first year, or as long a period as necessary if a year is impractical.

So with these quick tips, plan for success, and good luck in your chosen endeavor!

Strengths and weaknesses relate to internal factors, while opportunities and threats cover external ones. The internal factors can be divided into five categories: management, workforce, sales and marketing, operations, and financial. The external factors are also divided into five categories: threat of new entrants, bargaining power of suppliers, bargaining power of customers, threat of rivalry from competitors, and threat of substitution.

To approach the analysis in a structured way, prepare a checklist using the categories mentioned above. Identify factors within each category that are important to your business. Under management for example, a major weakness for virtually every small business is relying too heavily on the owner. What would happen to the business if something happened to the owner? In the workforce category a factor could be employee turnover and the availability of new hires. The threat of new entrants might include the possibility of a big box retailer opening near your business. The bargaining power of suppliers and customers categories should consider the possibility of losing a major supplier or customer. Come up with several factors for each category to complete the checklist. It is important that you do not try to rate or solve each issue as you identify them. If you do, you will get bogged down on each factor and never complete the analysis.

Once the checklist is complete, you should rate each factor based on its importance to your business. Use an alphabetical scale from A to E, where A = very important, B = important, C = some importance, D = little importance, and E = not important. Next rate each factor based on proficiency (internal) or vulnerability (external). Use a numerical scale from 1 to 5, where 1 = very proficient or not vulnerable, 2 = proficient or little vulnerability, 3 = average proficiency or some vulnerability, 4 = poor proficiency or vulnerable, and 5 = deficient or very vulnerable.

The factors with the lowest letter and highest number (A5) are the biggest weaknesses or threats. The ones with the lowest letter and lowest number (A1) are the biggest strengths or opportunities.

Using this structured approach makes a SWOT analysis possible and practical for any small business. To make this process worthwhile you must use this information to take action. Work to fix the worst problems first, prepare for the biggest risks, take advantage of the best opportunities, and build your secondary strengths.