Become A Master Negotiator

Summary: Appealing to a counterpart’s sense of power to get him to make a decision.

Asking a question like, “Do you have the power to make this deal happen?” can be an effective tactic. Some people feel compelled to say “yes” for the sole reason that it strokes their ego. People with big egos believe they are always right, and like to feel in charge.

Example

A man goes out to buy a car for his family. He is a bottom-line, results-oriented type of guy who is good at negotiating a great deal. Once he makes the decision to buy a car, he wants to do the research, take a test drive, negotiate a deal, and purchase the car all in one afternoon. The salesperson, sensing the buyer’s need for power, asks, “Do you have the power to make this type of decision without your wife?” The husband replies, “I am the sole decision maker when it comes to purchasing the family car.”

Counter

Obviously, the tactic of Higher Authority would work best here—and it is probably in this man’s best interest to employ it. He could say, “Although my wife and I usually agree on this type of purchase, I will have to review the purchase agreement with her to gain her approval.”

It is usually wise to get someone else to review any deal you are structuring. Asking someone else to review your proposed outcome is not a sign of weakness, but a sign of strength.

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Delaying a negotiation or decision to encourage the impatient counterpart to make a better offer.

Salespeople are typically short on patience when they smell a deal in the air. In fact, sales trainers sometimes teach that if you do not strike while the iron is hot, you might lose the deal. But impatience may encourage a negotiator to make unnecessary concessions. Knowing this, a savvy counterpart might stall for time, trying to make the impatient negotiator nervous and more willing to make trade-offs.

Example

A saleswoman prepares a proposal for a customer and, over the next few days, calls two or three times to ask what the customer thinks of the proposal. The customer never calls back because he is stalling, hoping the saleswoman will be willing to make some concessions if she feels he isn’t particularly interested in making a deal. Worried that the customer might be doing business with a competitor, the saleswoman gets nervous. Although she is not sure if the customer has even had time to review any of her proposals, the saleswoman leaves a message that her “numbers are ballpark, based on the information given, and there is room to negotiate.”

Counter

You should never discount a price before your counterpart tells you there is a need to do so. The best counter in this situation would probably be for the saleswoman to wait patiently for a reply. Or she could send an email to the customer, stating, “I have tried to get in contact with you several times over the last week, and for whatever reason, we have been unable to connect.” Under no circumstances should she leave any more phone messages.

When a counterpart is obviously stalling, be patient. Don’t keep using the same tactic to make contact. Think like a dolphin and do something different.

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Stalling a negotiation by creating the perception one is too busy to respond to a counterpart’s request.

To be an effective negotiator, you need access to the person who has the knowledge and ability to negotiate. Many years ago, secretaries played the role of Shark in the Moat, letting only a few, select people have contact with their bosses. Today we are more technologically advanced – we have Electronic Sharks in the Moat such as caller ID, voicemail, and email. It’s difficult to negotiate when you can’t get past someone’s electronic shark. Some negotiators use this tactic to their advantage.

Example

A commercial real estate professional is trying to secure an appointment with a corporate executive. No matter how many times the real estate professional calls, he constantly reaches the executive’s email or voicemail, and the executive herself, or the secretary, calls back at odd hours and leaves a voicemail or an email in response. Although the responses give the real estate professional hope of an actual meeting, the Electronic Shark in the Moat is very effective at keeping a distance between the two counterparts.

Counter

The real estate professional could try calling very early in the morning or very late in the afternoon when there is less chance that the Electronic Shark in the Moat is on duty. A second tactic is to utilize Find Us an Umpire (either within or outside the executive’s company) to help bring the two people together.

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Refusing to take no for an answer.

If you have children, especially teenagers, you know that sometimes you may give in to their demands just to be able to get on with your life. The same tactic works quite well in the business world.

Example

I have a son who was the master at asking for something over and over again, from many different creative angles, until he accomplishes his goal. At one time, his major life goal was to own a video game console. He asked for one almost every day for a period of two years. His creative questions included, “Could I buy it with my own money?” And “Could I buy a handheld until I can get the console?” He also asked why other parents I respect bought their kids video games. The questions went on and on. I even told him, “Video games are a dead horse in our house, and if the horse is dead, you should get off it!” Refusing to give up, my son creatively asked the following great question: “Dad, is it important to you and Mom that I can make quick decisions in complex situations?” When I said, “Yes,” he came back with, “Great! I think video games help kids make quick decisions in complex situations.” After two years, he finally got his game console. As I relfect upon this, I understand why persistence is such a successful tactic.

Counter

In this particular example, my best defense would probably have been a solid track record of not caving in to persistence. A second effective tactic would have been No More Mr. Nice Guy—I could have removed a deal point that my son felt had already been conceded. For example, I could have said, “If you bring up video games one more time this week, I will take away your computer for the rest of the week.” Since spending time on the internet was as high on my son’s explicit need list as video games, this tactic might have worked well.

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Taking back something that has already been agreed to.

This tactic is particularly effective when your counterpart is not being honest or is pushing you to the end of your rope with excessive demands. You take something back that you have already agreed to.

Example

Lloyd and Nancy have been renting an apartment for three years. For about six months they have been feeling ill, but no one can figure out what their problem is. One day, while moving furniture, they find a wall covered with black mold. After doing some research, they discover that this mold could be what has been causing their health problems. On March 10, Lloyd and Nancy move out of the apartment and tell the landlord that they will not return until the moldy wall has been repaired. By March 20, the landlord has taken no action, so Lloyd and Nancy tell the landlord that they are moving out and requesting a refund of their deposit. When the landlord refuses, saying that Lloyd and Nancy have not provided thirty days’ notice, they hire an attorney, who demands the return of the couple’s deposit and a refund of the rent for March as well.

Counter

A fair person would probably have quickly repaired the moldy wall or returned the security deposit as requested, and therefore would not need any counter to this tactic. However, looking at the negotiation from the landlord’s point of view, he could try asking if the couple would be satisfied if he fulfilled the original request for a repair. Another option would be to show how he has been working on solving Lloyd and Nancy’s problem (collecting bids for the repair, etc.). Or he can agree to the lawyer’s demands but try to gain something in return, using the Trade-off Concession: “I will agree to cut a check for March’s rent and the security deposit if you will sign an agreement not to hold me liable for any future illnesses.”

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Getting an unbiased third party to mediate a negotiation.

When two counterparts do not have a history of working well together, using an intermediary, or “umpire,” to facilitate the negotiation can sometimes prove helpful. In this case, a third party who has had previous positive relationships with both counterparts enters the picture.

Example

Two corporate presidents know it is in the best interests of both their companies to merge. In fact, they know that if they continue on the present course, they will both eventually be leading unprofitable companies. The problem is that they have met twice before to negotiate a merger. Since each of them has an ego the size of King Kong, they have left the table without a deal each time, and their relationship has ended up even more strained. A vendor who sells machinery to both companies, and is well liked by both presidents, enters the picture. This vendor starts to talk with each president separately about merging the companies and eventually brings the two presidents face-to-face to create a win-win outcome.

Counter

Of course, an obvious counter would be for one counterpart to refuse to work with a mediator but, in this example, countering would not be in either president’s best interest. If you agree to work with a mediator in a negotiation, we have two helpful suggestions. First, make sure you verify that the mediator chosen is truly impartial and does not unfairly represent one side. Test the information the mediator presents for accuracy. If necessary, talk to others who have worked with the mediator in the past to ensure his character is strong and his results are credible. Second, verify the fees or costs of the mediator’s services up-front so there are no surprise bills or sudden requests to split his commission.

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Appealing to a counterpart’s feelings by acting personally upset by an offer.

Most negotiators want to avoid hurting someone else’s feelings. Tough negotiators don’t mind being ruthless, since they consider their actions just a part of business, but even they don’t feel comfortable when someone tells them they have hurt his feelings or betrayed him in some way.

Example

We were negotiating a subcontract for our services. In the middle of the negotiation, the contractor stopped and stated that it was important that we know how he felt. He went on to tell us that because of our long business relationship, he felt hurt and betrayed that we would not work for him unless we made a higher fee. We backed up and changed our aspirations because we felt terrible that he was taking our actions so personally. We do not mind driving a hard bargain, but we do not want to hurt people’s feelings in the process. Unfortunately, we learned when this happened a second time with the same person that the “hurt feelings” were just a tactic.

Counter

We could have simply apologized and asked the contractor to clarify why he felt hurt. Or it may have been helpful to ask, “If You Were in Our Shoes, could you understand why obtaining the higher fee might be important to us?”

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Making an offer that is contingent on specific conditions.

This tactic, which is similar to The Trial Balloon, is used to check out your counterpart’s acceptance of your proposal. This tactic is based on the idea that most people never give up anything without getting something in return.

Example

You are an office supplies salesperson. A potential buyer asks you, “If I am willing to sign the purchase order today, then would you be willing to lower the price by a dollar per unit?”

Counter

Before accepting an If… Then offer, make sure that what you are agreeing to is in your long-term best interest. You may want to reverse the tactic, asking your counterpart, “If I do lower the price, then will you be willing to make each payment ‘net 10′?” Or you may want to buy more time to research the long-term value of the proposal, using the I’ll Think About It and Get Back to You Later tactic: “Before I agree to lower the price by that much, I need to think it over and do more financial projections. I will get back to you next week.”

Have you used or encountered this tactic in your negotiations? If so, how’d it go?

Summary: Testing to see how firm a counterpart is on certain issues.

Finding out how firm your counterpart is on the key issues is often helpful in a negotiation. You can get some information by sending up a Trial Balloon and watching your counterpart’s reaction. This tactic may give you a better understanding of what to expect when you get down to doing the final negotiation.

Example

A home seller is asking $450,000 for her house. The buyer might say, “I can give you $430,000 in cash and have the money to you in one week. Would you be willing to sell me your house at that price?”

Counter

In this example, the YIKES! You’ve Got to Be Kidding! tactic could prove effective. A second effective counter could be the response, “That’s Not Good Enough.” A third possible counter could be to support the $450,000 asking price with Facts and Statistics, citing the selling price for comparable homes in the neighborhood.

Have you used or encountered this tactic in your negotiations? If so, how’d it go?