Negotiating the removal of a clause from your equipment leasing contract is not difficult if you arm yourself with all the relevant knowledge and have the right strategy and tactics.
Any tiny alteration in a contract will involve negotiation. The golden rule is that you must prepare yourself before entering any negotiation. Too many times folks let their emotions get the better of them and pick up the phone without thinking only to suddenly find themselves right in the middle of a negotiation they have absolutely no chance of winning.
The removal of one tiny clause from an equipment leasing contract may at first sound like a walk in the park. However you need to remember that the leasing company people are professionals who deal with clients like you every day. They are experts at negotiating the best possible terms in their favor and as far as leasing contracts go you are a rookie in this case.
That does not mean you should accept defeat before you even start. It simply means that you need to be well prepared and carefully think through what you want to do and what you are out to achieve.
Arm Yourself With Knowledge
Take the time to do your research and even make calls to those who know. You will need a solid negotiation strategy and there is no way you can craft one without as much knowledge as possible on the particular clause that you want removed from your equipment leasing contract. Your research needs to unearth how important that particular clause is to the leasing company. If you have evidence that the clause has been left out of other similar contracts then that is a great place to start.
Find Your Opponents’ Weakness
Like in any other negotiating situation it is important to understand the strengths and weaknesses of the other side. Your strategy should then revolve around using your strengths against their weaknesses. Information about previous contracts that went bad will be invaluable and the kind of information that will put you in a position of strength. Sometimes people tend to ignore the most obvious source of information; the World Wide Web. It is amazing what a simple Google search can unearth about people and companies.
The bottom line here is that you need to know what you are worth. How badly does the leasing company need this deal? How badly do you need it? Perhaps you have poor financials and were lucky to get the lease in the first place. In such a case you will need to find an edge for yourself that you can use against the leasing company.
Always Try To Open Extreme
Situations differ but the rule of thumb is to always try to open your negotiations with the maximum you can logically argue for. For instance you want a clause removed, start by asking for the clause to be removed and another one added. This way it will be much easier to settle for the removal of only one clause, the one you wanted out at all costs. You can even go further and make an outrageous request fully aware that you will negotiate down to what you really wanted. And you never know you could even get your outrageous request fulfilled as a bonus. Be bold, it pays.
What’s Your Break-Even Point?
Before you go into the negotiation to have the clause removed decide the worst case scenario that is acceptable to you. It could be the re-wording of the clause rather than the removal altogether. Or is could even be the removal. This is important because many times folks who do not do this beforehand are forced into accepting a deal that is not in their best interests and the consequences only sink in much later.
Also knowing the worst case scenario will help you establish the starting point of your negotiation. You NEVER start a negotiation at your break- even point. NEVER. Always prepare yourself psychologically to walk away from the table if things do not go according to plan. You never know the other side may just call you back and even if they don’t a bad deal could end up being very costly.
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Get Another Deal As Leverage
Depending on how important that single clause is, you could go into the trouble of finding another leasing company willing to draw up a more agreeable contract. You can then use this as leverage against the first leasing company. This way you will be negotiation from a position of strength and this will always give you an edge to get the best possible equipment leasing deal.
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