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CHAPTER 17 - NEGOTIATING YOUR BEST DEAL
First learn to say NO. Now you're
ready to negotiate. Most Entrepreneurs approach the issue of negotiating
with great stress and anxiety. This leads directly to weak negotiations
or becoming defensive about being asked too many questions. Either
way, you lose! In order to avoid this happening to you, make sure
you have clearly defined what you are looking for before the negotiations
begin. Then…
 Determine which points are worth
fighting for.
Express your objections and
questions to any point.
Get it in writing, leave nothing
to verbal agreements.
Subject everything to
your long range goals.
Pay close attention
to what triggers default.
Establish ceilings and caps. You
don't want to be stuck paying huge payments if rates
go up.
Plan for the downside. Attempt
to have an "interest only" clause or "skip payment"
provision in the event
of slow downs.
Look for no pre-payment penalty
or the right to buy back your stock at a fixed price.
Pay attention to covenants,
conditions, ratios, restrictions or other clauses which can
have serious long term
effects.
Try to minimize pledging collateral.
You may need those assets in the future to raise
additional capital.
Seek professional counsel before
you sign anything. Lawyers and accountants may
not help you fund your deal,
but they can help you spot the small details that may
burden you down the road.
Summary
Remember you are out there selling yourself and your company.
Be a closer! Only accept "No", as being one step nearer
to "Yes". We sincerely hope the material presented
here will help you plan for your success and locate the funding
that every business needs. Good luck, in your search for funding!
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