Become A Master Negotiator

Summary: Raising an unreasonable deal point to distract a counterpart and get her to make a concession on another deal point.

You place a deal point on the bargaining table that you don’t expect to achieve and don’t particularly care about, knowing that it will be about as acceptable to your counterpart as the smell of a dead fish. When your counterpart makes a fuss, you offer to give up the deal point, but you make it sound like a big concession on your part so you can ask for something in return.

Example

Consuela is buying a used car from Josh. Josh is asking $10,000. Consuela wants to pay less, so she lays The Dead Fish on the table, asking Josh to purchase new tires. When Josh balks at the suggestion, she agrees to drop the new tires demand, but only if he lowers his price by $400.

Counter

Josh could simply insist that the price is not negotiable. Or he could use Apparent Withdrawal, These Boots Are Made for Walking, or the Trade-Off Concession.

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

Summary: Making a big issue of something unimportant in order to gain a concession that matters more.

With The Decoy, you make a big issue of something you don’t care much about when you are really after something else more important to you.

Example

You’re buying a new copier and you strike a deal. The only option the copier doesn’t have is the ability to email files, which the dealer agrees to install for you. When you are getting ready to sign the papers, the dealer informs you that it will take a month to get the copier ready. Although the time frame is not that important to you, you make a big issue of it, hoping that the dealer will make another price concession. In fact, you even tell the dealer you will go somewhere else if he can’t make the long wait worth your while.

Counter

If he suspects your motives, the dealer can utilize Uncovering the Real Reason to expose your tactic. Other options are Apparent Withdrawal and These Boots Are Made for Walking.

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

Summary: Avoiding immediate agreement to a counterpart’s offer to prevent the impression that the negotiation was too easy.

Have you ever felt that you paid too much for something? Chances are you felt that way because you didn’t have to fight hard enough for your outcome. When someone says “yes” to your first offer, you walk away with one of two feelings: You may think you paid too much or, as if that feeling were not enough to make you have buyer’s remorse, you may think something is wrong with what you just bought.

Example

A woman is buying a used couch at a garage sale. She challenges the seller with, “You’re asking $300 for this couch. Would you consider taking $200?” The seller responds, “Sure, $200. It’s a deal!”

Counter

First, this is the time to use the tactic of The False Alarm . The buyer could say she was just asking if $200 would be acceptable, but she thinks that is still too much to pay. Then she could raise her level of aspiration. Second, she could use the Higher Authority tactic, telling the seller that $200 sounds reasonable to her, but she needs her husband to come over and take a look at the couch.

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

Summary: Giving a counterpart several acceptable alternatives to choose from.

You can use this tactic when you have several alternatives that are acceptable to you. Salespeople are trained to use this approach to gain a buyer’s commitment.

Example

A car buyer tells the salesman, “I’m looking for a 0% loan. However, I am willing to buy this car for $23,999 at 4.5% interest, but only if you throw in the paint sealant, upgraded sound system, and floor mats. Either way, The Choice Is Yours.”

Counter

The salesman has lots of options here, including: saying “no” to both deals and starting over; making a counteroffer to one deal or the other; using Apparent Withdrawal; employing These Boots Are Made for Walking; or making a Trade-off Concession.

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

Summary: Attempting to change the outcome of a negotiation after the counterpart thinks everything is settled.

Have you ever been involved in a negotiation and thought you had concluded a deal, only to learn that the other person was just getting started? This is known as The False Alarm.

Example

While you’re purchasing a commercial building, you negotiate with the owner and agree on a price of $940,000. You’re convinced that you have a deal. Later that day, the owner of the building calls to tell you he has presented the offer to his business partner, and his partner reminded him that although the sale price of $940,000 was accurate, he had forgotten that there would be an additional $6,500 in loan charges on the property.

Counter

There are several possible counters. First, when the owner tells you about his partner’s increase in price, you could use the tactic of the Withdrawn Offer. Tell him you shared the deal with your business partner and she will not let you pay more than $935,000. (This also employs the tactic of the Higher Authority.) Second, you could expose the owner’s tactic and say that the deal you struck is good only for twenty-four hours. If he does not take the deal right away, you will have to start the negotiations over again. Third, you could employ These Boots Are Made for Walking . Finally, you could utilize the Trade-Off Concession, saying, “Yes, I will pay $940,000 plus the additional loan charges, but only if you paint and re-carpet the entire building.”

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

Summary: Breaking the price up into small increments to lessen the impact of the total amount.

With this tactic, you break dollars and cents down into such small amounts that your counterpart doesn’t realize he is dealing with large sums of money.

Example

Last year, at the San Diego County Fair, I was intrigued by a vendor selling ceramic knives. When she finished expertly cutting up everything in front of her, I made the mistake of asking how much the knives cost. Her reply was, “Peter, these knives have a full guarantee for a period of ten years. Over those ten years, they are going to cost you only about eighteen cents a day.”

What this saleswoman did was break the total price down into the daily cost. Obviously, almost anyone can afford eighteen cents a day. I am still kicking myself for falling for the Funny Money close.

Car dealerships are masters of the Funny Money tactic. They try to get the buyer to think only about the monthly payment and keep him in the dark about the total price and interest rate until the deal has been struck.

Counter

In both examples above, the buyers should do their homework and spend some time working out the total price. If their counterparts are unwilling to provide a full disclosure of all terms, the buyers should simply walk away from the deal.

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

Summary: Making a ridiculously low or high offer.

Example

You’re trying to sell your house for $289,000 when your agent brings you an offer of $260,000 from a couple who saw the house over the weekend. If your house is competitively priced, this would be considered a lowball offer.

Lowballing is effective because it tends to lower a counterpart’s aspirations. If you counter the couple’s offer with $180,000, their next offer of $275,000 won’t seem so bad. If they had originally offered you $275,000, you would probably have countered higher than $280,000.

Counter

If someone lowballs you, you have three options: (1) Do not counter! Utilize These Boots Are Made for Walking and move on. (2) Counter by repeating your asking price. (3) Using the tactic of the Withdrawn Offer, counter with a figure higher than your asking price. Explain that the couple must have misunderstood the actual price, and then counter their ridiculous offer with an even more ridiculous price.

If someone highballs you, you also have three options: (1) Do your homework to find out whether the price is competitive. (2) Use the Power of Competition. Demonstrate with a competitive analysis that the price is unreasonably high. (3) Ask for a price breakdown.

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

Summary: Taking back an initial offer to keep from being taken advantage of.

Truly withdrawing your initial offer may be in your best interest in some situations. This tactic can be used when you feel you are being taken advantage of or put in a position where you can only lose.

Example

Joseph is selling a house that he owns jointly with a partner. The asking price is $226,000, but the buyer is a very tough negotiator. By using the Salami tactic, the buyer manages to reduce the price to $221,000, have the escrow extended to ninety days, and stipulate that Joseph and his partner will carry back a $20,000 second mortgage at 9 percent. Joseph thinks the deal is finalized… until the buyer brings his wife into the picture.

The buyer’s wife says she hates the kitchen and will not allow her husband to pay any more than $219,000 for the house. That is when Joseph says he has bad news for the buyer: Joseph’s partner has decided that they should not sell the house for any less than $223,000. Since the buyer really does want the house, he spends the rest of his negotiating energy trying to get the price back down to $221,000.

Counter

First, rather than scrambling to get the price back down, the buyer could utilize These Boots Are Made for Walking. If Joseph really wants to make the deal, he will come back. Second, the buyer could use Apparent Withdrawal, giving the appearance that he is quitting, to regain control of the situation.

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

Summary: Acting uninterested in continuing the negotiation.

Although you sometimes may not want to go to the extreme of walking away from a deal, you may still want to give your counterpart the feeling that you are not really committed. Apparent Withdrawal should be used when you want to give the appearance that you do not care, when in reality you are simply trying to retain control of the situation.

Example

Several years ago, a friend of ours was negotiating to buy a beautiful home. He had gone through several days of negotiating on many deal points. He was in love with the house but the seller’s last concession was still $4,000 above what our friend wanted to pay. So he called the seller’s broker and said that he was going to have to withdraw from buying the house because he could not make the numbers work to his satisfaction. Our friend was confident that neither the seller nor the broker would let a $300,000 deal go over a difference of $4,000. Since our friend was willing to pay the $4,000 if he had to, this was a case of Apparent Withdrawal rather than Withdrawn Offer.

Counter

The broker had at least three possible tactics at her disposal: These Boots Are Made for Walking , I’ll Meet You in the Middle, or Trade-Off Concession. Any of these tactics could have worked to bring our friend back to the bargaining table without giving in to his lower price.

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

Summary: Citing lack of precedent as a reason for turning down a deal point.

When you cite a precedent, you use something that has happened in the past to justify a current request, position, or concession. Lawyers often cite precedents, using actual court cases to support their positions. Reversing this tactic by saying, “There is no precedent for that,” or “We’ve Never Done That Before” in reference to a deal point can be very effective.

Example

A hotel guest asks to extend his check-out until 2:00 PM. The guest services person denies the request, saying, “I am sorry for any inconvenience, but we never extend checkouts past noon.”

Counter

The guest could respond by Asking a Closed-Ended Question, such as, “How much would it cost to stay an additional two hours?” Or he could counter with a precedent by pointing out, “Every OTHER time I have stayed with this hotel chain, I have been allowed a 2:00 PM check-out when I requested it.” As a last resort, he could utilize the tactic of the Higher Authority, going over the guest services person’s head and asking to speak to the manager.

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