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The Basics of Negotiations

Be the best you can be – and then, even better.

 

Lease or buy[1]

1. Everything can be Negotiated:

To be a successful negotiator, you need to be assertive and not afraid to challenge everything. Being assertive means asking for what you want without demonstrating anxiety or anger. Assertiveness is part of the Negotiation process.

2. Listen and let the other party do the talking:

By listening, you are taking the role of a detective. Detectives ask probing questions and then shut up. The other negotiator will tell you everything you need to know – and more. All you have to do is to listen.

3. Gather all the facts:

Acquire as many facts about the other company, their product, their current situation, what’s in it for them by having a successful outcome, what their options are, etc. You can’t make accurate decisions without really understanding their position. The more information you have, the stronger your position will be during the negotiation.

4. Be willing to walk away:

Never negotiate without options. It is when you become too dependent on a positive outcome that you lose your ability to say “No”. By considering the option to walk away whilst in Negotiation, you will force the other party to make concessions that may be in your favour.

5. Be patient:

The more you rush the more likely you will make a mistake. The side that has more time flexibility has the advantage. The greatest amount of patience causes the greatest amount of devastation to the other party as they assume you are not under any pressure to conclude the deal. They become pressurised to do so and in turn offer you more concessions with the incentive of you agreeing to conclude.

6. Aim for best outcome:

Be an optimist – if you expect the best you will open the door to receive the best. Sellers should ask for more than they expect and buyers should offer less than they would want to pay. If you aim higher you will do better. A low expectation will result in a less satisfying outcome.

7. Keep the pressure focused on the other party:

It is human nature to focus our energy on our own pressure by highlighting our own  situation. This is often recognised by the other party and subconsciously we give the power to the other side. By focusing on our limitations, we miss the big picture. Our job as the detective is to recognise their worries and concerns and see how these can assist our cause.

8. Focus on meeting their needs:

By understanding their perspective places you ahead of the game. By helping them to achieve their needs is a sure way of them coming back to do more business. This is not saying we must give in to all their positions. We must ensure that their basic interests must be fulfilled not necessarily their demands.

9. Never concede without getting something in return:

Always create a tie-in, “I will do this if you do that”. Without a tie-in, you are causing the other party to add more concessions. When you concede and they are not expected to reciprocate, they will feel entitled to your concession and will not be happy until you give up even more.

10. Never personalise their attitude:

Never get side-tracked by personal issues that are unrelated to the deal. Focus on solving the problem. Trying to understand their behaviour can sabotage the outcome as they may be using dirty tricks to force a conclusion. This will only frustrate you even further and you could be falling into their trap.

 

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