Become A Master Negotiator

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?

Summary: Sending the message that if the counterpart doesn’t agree to the offer, the negotiation is finished.

An effective tactic used by negotiators is saying, “This is our best and final offer. Take It or Leave It.” This tactic, which is commonly used by labor unions, is designed to discourage additional negotiation. Making a fixed offer sends the message that if the counterpart does not agree, there will be no further discussion. A real test of egos ensues when a counterpart replies, “We’ll leave it. We are walking out of the negotiations.”

Example

The mechanics at a major airline have gone without a contract for several years because the mechanics’ union and management have not been able to agree on salary. Finally the union demands a salary package and says, “That is our best offer. Take It or Leave It.”

Counter

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Summary: Changing the time for reaching a decision on a deal point.

Since many negotiators set a deadline for making a decision, it is important to note that almost every deadline can be moved. Instead of hastily making a bad decision under the gun of a deadline, consider changing it.

Example

A salesperson tells a potential buyer that the sale price on a particular product will be available only until the end of the month. The buyer explains, “That is too bad because I do not get paid until the fifth of next month and all my credit cards are maxed out. Is it possible that on this one item you could get management’s approval to give me a rain check on the sale price until the fifth?”

Counter

The salesperson could counter this tactic by protesting that his company has a formal written policy of not extending the sale price on items, since doing so would mean that everything in the store would be on sale all the time! A second effective counter is the tactic of There Is More Than One Way to Skin a Cat. The salesperson could offer the option of a layaway, writing up the sale today but setting the product aside until the fifth. This would accomplish both counterparts’ goals.

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

Summary: Preparing multiple options for resolving deal points before a negotiation begins.

In a negotiation, the counterpart with the greatest number of viable options usually gets the best outcome. A good tactic is to walk into a negotiation with three to five possibilities for accomplishing your goal. This tactic empowers you because when your counterpart puts a roadblock in one direction, you have other viable alternatives.

Some of the most difficult negotiators to deal with are unilateral thinkers who believe there is only one way to do things. When one counterpart won’t look at options, the negotiation is likely to result in a lose-win outcome.

Example

You would like to hire a star salesperson for your company. Your boss has enforced a salary ceiling of $70,000 for the position. But during an interview, you discover that the salesperson you want to hire has a base salary of $75,000 at her current job and will not leave for less.

You reopen the negotiations with a different proposal. You offer the salesperson a base salary of $70,000 but promise to give a $15,000 bonus if she can reach sales of $500,000. This arrangement is more acceptable to your boss, and the salesperson thinks she will have no problem selling $500,000 worth of your product.

Counter

The salesperson could use the tactic of I’ll Think About It and Get Back To You Later, to have time to evaluate the new proposal. If her goals and your’s are still some distance apart, she could try the tactic of I’ll Meet You in the Middle.

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