Whenever you are discussing a contract, forging a deal, or doing business of any kind, think of your conversation in terms of three stages: the warm-up, the core, and the wrap-up
Once you and your business companion have said your hellos and taken your seats, engage in a little small talk- chat that can range from the day's top news story to your golf handicap to, yes, the weather. A minimum of five to ten minutes is usually devoted to this opening stage. Throughout, camaraderie is punctuated by smiles and laughter, but only when genuinely called for.
After an appropriate amount of time, the talk turns to the business at hand. Make clear your personal investment in this longer portion of the conversation by sitting erect and making eye contact. As the conversation gets rolling, keep in mind that you are engaged in a dialogue, not a monologue. Even if you're launching into a length explanation of a complicated new technology, draw the other person into the conversation by pausing occasionally to ask questions such as, "Am I making sense to you?" or, "What do you think so far?" Also be careful to use the word "you" as often as "I"; this conveys a message to your partner that you consider him or her integral, not tangential, to the business being discussed.
Although you should put smiles aside during this stage for the most part, don't abandon altogether the occasional snippet of small talk; leavening the conversation with the occasionally funny aside or pertinent anecdote keeps the atmosphere more relaxed and helps you get your message across. Hammering your point too aggressively or relentlessly, on the other hand, can have the opposite effect.
Ending with a brief recapitulation of any decisions made during the conversation ensures there are no misunderstandings. But once you've wrapped up your business and resumed your small talk, stick with it. Letting go of the business topic and ending the conversation on a purely social note is an implicit acknowledgement of the friendly nature of the business relationship.