“You need to know the other guy’s money, know the other guy’s wallet, start discussing the money early and use ranges to qualify and disqualify,” says Searcy.
“Don’t discount early and don’t negotiate until it’s time.”
Uncertainty can be a dangerous enemy in organisations when you are making big deals or sales, according to Searcy.
Your buyer and associated stakeholders must understand the schedule of events.
He says a schedule is not just a calendar, because a calendar only presents a sequence of actions.
The schedule, to be of persuasive value, also needs to include performance metrics so that all participants can assess progress by the quality of planned outcomes.
What happens if things are not working? Buffett warns that the path to a big deal is seldom smooth.
“The roads of business are riddled with potholes; a plan that requires dodging them all is a plan for disaster.”
At the same time, Searcy warns you need to look at what happens if the milestones for performance set out in your deal process are not met.
Will there be a revision of the budget, staffing, the entire plan? Clarity in the off-ramps gives confidence to the cautious.
Searcy begins his book recounting Buffett’s deal to buy Nebraska Furniture Mart – a deal sealed with a handshake in the middle of the store.
Buffett had done all his research, so when it came time to close a deal he could to it quickly.
He has a penchant for fast deals and tries not to delay, as delay can kill a deal.
“If you want to marry, don’t tarry,” Searcy advises.
Searcy’s advice for SMEs is to go big like Buffett has.
“Shoot for the stars; look for the big opportunities that are out there. Lots of small businesses think, ‘I am tiny, I am small I can’t do that’,” he says.
Buffett is 82 years old now but Searcy says it is interesting to think what he was like when he was 22 or 32. He wasn’t a billionaire yet but was forever working to the next opportunity and setting his goals higher.
“That’s how he got to be the second richest man on the planet,” says Searcy.
“Warren Buffett is a one generation billionaire. He did not start out rich, he started out like you and me but he dreamt big.”
Cara Waters is the editor of SmartCompany. Cara was previously a senior reporter at the Financial Times website FT Adviser in London and has also worked for The Sunday Times.
