The art of the deal

As a budget owner it can sometimes be frustrating negotiating with sponsors, particularly when they don’t understand how to make the most of a partnership with government agencies, writes Sam Trattles.

Sam Trattles

Here some considerations to help these negotiations, and subsequent relationships, run a little smoother.

Look for the gold

We would love if people pitched their projects or ideas to us clearly, succinctly and with obvious measures of success. However, most of the time, people get super stressed when pitching to government as it means so much to have you on board, so they ramble, they aren’t clear, and they forget about the “WiiFM Element” (What’s in it For Me).

Sadly, this can sometimes mean that great projects don’t get off the ground. If you like the idea, and have the patience to lead the witness to draw out the gold from what they are pitching to you, it’s likely they will be a great partner.

Spell out the value

Those that are new to partnering with government, particularly local government, often undervalue the rights that can be offered to them. These deals are often less of a cash injection, but more about in-kind or contra.

Take, for example, traffic management planning. The costs of executing this can be significant on an agency and it is important that a sponsor is fully aware of what’s involved so they appreciate the value of the deal (if they had to pay for these services themselves).

So, when you are negotiating with a partner, invest time helping them understand the true value of these inclusions to the deal. These are true P&L expenditures that if they don’t get a partnership with you over the line, they will have to spend money on these services, so it is worth a great deal.

Say “no, but…”

It can be difficult to say no to ideas that are good, but simply aren’t aligned with where your government agency is currently focused. Add to this, that Australians really don’t like disappointing people, so we are not overly comfortable letting people down. Sadly, this often leads to avoidance.

However, there is an easier way – 5 seconds of pain – by saying thank you, then one of the following sentences:

  • It’s a no from us, but we wish you all the best
  • It’s a no. The timing is off so please re-pitch next year
  • It’s a no as this project doesn’t align with our current strategy, but it might in the future
  • It’s a no, but it might be good for (insert another agency or corporate brand)

A quick no, is better than a long, drawn out maybe, so take the weight off your shoulders, stop them calling you to follow-up and put them out of their spiral of hope.

Partners for the long haul

Great partnerships are enduring because they take a lot of work from both parties. You are likely to be spending a great deal of time together, so during the negotiation phase it’s important you are dealing with the team who will roll out the project (not a salesperson).

Go with your gut instinct. If you and your team get a good feeling from the sponsor team, go for it, if not – call it.

The first year is usually the hardest, as you are building the relationship, understanding how each other likes to work, AND rolling out an event or project. To make the most of this effort it is vital to negotiate multi-year deals help amortise this investment. Of course, you will want to build in success measures and ways to exit the deal if it is a failure, signing a 1-year deal with a 2-year option shows intent, gives your team comfort, and is a good incentive for the sponsor to work hard in year one (and beyond).

Partnerships can help both parties grow, they can open up new audiences and they can deliver opportunities we are proud to have as part of our legacy. So, negotiating good deals with great partners that share your values, vision, and mindset, should lead to the creation of amazing things.

Sam Trattles is a Commercial Deals Negotiator who has closed deals across sport, music, the arts, philanthropy and grass roots programs. She works with business leaders, sponsor brands and those seeking partners to create strategies. She is the author of  I Love Negotiating.

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