Summary: Adding an extra or add-on to make a deal work.

At times you may need to add a little something extra to make a deal work. For example, a salesperson may decrease the price of a product, add a warranty or training at no additional charge, or agree to extend a sale price to make a deal more enticing. This tactic of offering an extra or add-on is called Sweetening the Deal.

Example

A customer tells a carpet saleswoman, “Your carpet is a dollar per yard more expensive than your competitor’s.” The seller Sweetens the Deal by saying, “I will carpet each of your closets for free if you will sign the contract today.”

Counter

The Trade-off Concession could work well here. The customer might reply, “I will sign the contract today if you carpet the closets for free and can have the carpet installed by Friday of this week.” From the salesperson’s point of view, an effective counter to the customer’s counter would be, “I can install the carpet by Friday, but if you are looking for the highest-quality installation, keep in mind that my best installers will not be available until next Wednesday. Will that work for you?”

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

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Summary: Making a final, specific demand to force a counterpart to make a decision.

From time to time it may be in your best interest to “draw a line in the sand,” or create a rule that allows you to hold your counterpart accountable. One tactic you can use is to tell your counterpart the actions you will take if your conditions are not met.

Example

A client calls a consulting firm and asks to tentatively reserve a date for a seminar to be presented at her company in approximately six months. Three months prior to the date in question, the consulting firm calls the client and asks her to confirm the reserved date or the firm will have to offer it to another client who has requested the same day. The client is told that a confirmation is needed within twenty-four hours, which makes the deadline her Ultimatum.

Counter

If you wish to complete a deal but need more time to get permissions or approvals, one of the most effective counters to the Ultimatum is postponement. In this specific example, the client might respond that she cannot get the date confirmed within the 24 hour time frame, but she can have an answer within 48 hours, and ask if that would be acceptable.

If the deal outcome is not important to her and she needs more time to get approval, she can simply walk away and find another seminar provider.

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

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Summary: Getting something in return for everything that is given up.

A good rule to remember in negotiation is to get something in return every time you give up something.

Example

A home buyer states, “I will buy your house for $480,000, but for that price, you will have to throw in your washer and dryer.” The seller responds, “If I do that, you will have to close escrow in thirty days,” or, “You will have to pay $482,000.”

If the seller does not get a trade-off every time she makes a concession, her counterpart will most likely ask for more concessions. Then, if the seller suddenly says, “Wait a moment. I already gave you the washer and dryer, and now you are asking for more concessions,” the buyer can respond, “Why are you bringing up the washer and dryer? We already agreed to that.”

Counter

The buyer might respond to the seller’s counteroffer with another deal point. He could say, “If you throw in the washer and dryer, I will close escrow in thirty days, but you will have to carry back a $20,000 second trust deed for one year.”

When using the Trade-Off Concession, the following are good rules to keep in mind: If you can, encourage your counterpart to concede first

• Exchange concessions for deal points that have less value to you, but greater value to your counterpart
• Concede in small increments
• Consider phrases like, “I’ll consider it,” and, “Let me think about that.” Just say “no” if the concession is not in your best interests
• Do not concede anything without getting something in return. Your counterpart will have more appreciation for the final outcome and more respect for you

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

All Negotiation Tactics

Summary: Using statistics to support an offer or a point of view.

Anytime you can incorporate Facts and Statistics into your presentation, you have a tool that your counterpart will find difficult to handle. Reliable facts can add a tremendous amount of power and credibility to your case. But be careful—if you quote statistics incorrectly and your counterpart proves you wrong, you lose your credibility. Once this happens, you have to fight twice as hard to gain any deal point.

Example

An employee goes to his boss with a recently published salary survey documenting that the employee’s salary is significantly below market. The employee has pulled Facts and Statistics that examine salary levels by industry, position, and geographic location to demonstrate the discrepancy.

Counter

First, the boss could question the validity of the employee’s Facts and Statistics. Who participated in the salary survey? Who collected the information? Are the salary statistics valid for someone with this employee’s experience? As a second option, the boss could delay the negotiation process to give himself time to do some research and develop his own Facts and Statistics.

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

All Negotiation Tactics

Former President Bill Clinton famously told us, “I feel your pain.” I am unsure if he truly had empathy for those who were listening and if he really felt our pain, but I do know that to be an effective negotiator, once must learn to show empathy.

Empathy is defined as “the intellectual identification with or vicarious experiencing of the feelings,
thoughts, or attitudes of another.” In a negotiation, empathy is an important asset because it allows both counterparts to see the other’s perspective and conduct the negotiation in a way that is beneficial to both parties.

Another benefit of empathy lies in the fact that if you properly construct your reflective response, your counterpart’s natural reaction will be to provide more explanation and information. You will find the following tips helpful in learning to be more empathetic.

1. Recognize and identify emotions. Most inexperienced negotiators are not adept at recognizing a myriad of emotions. However, you will find it easier to identify others’ emotions if you can easily identify your own. Make it a habit to check how you are feeling. Are you frustrated, stressed, angry, happy, sad, nervous? Now, use the following skills to identify your counterpart’s emotions:

   • Recognize body language
   • Skillful questioning
   • Attentive listening

2. Rephrase the content. If you restate your counterpart’s comments word for word, she will believe you are parroting her. Doing so not only sounds awkward, but also makes your counterpart angry. The key is to restate the content using different words.

3. Make noncommittal responses. A good way to start reflective statements is with such phrases as “It sounds like…”; “It appears that…”; or “It seems like…” These phrases work well because they are noncommittal. If you blatantly state, “You are angry because…” most people will proceed to tell you why you are incorrect.

4. Make educated guesses. Recently we were involved in a negotiation for the sale of a business. The seller told the potential buyer that the offer he had submitted for buying the business was ridiculous. The buyer responded, “It almost sounds like you are insulted by my offer.” The seller replied, “Not insulted, just shocked.” Although the buyer was not entirely accurate in his assessment of his counterpart’s emotion, it was a good educated guess. Educated guesses work well because even if your guess is not entirely accurate, it will most likely encourage your counterpart to clarify his true feelings.

If you put these 4 tips into action in your daily negotiations, you will notice a shift: you will find yourself better able to understand your counterpart’s perspective and objectives which will increase your chances of coming to an outcome that is mutually beneficial.

What have you learned about showing/being empathetic in negotiations?

You may also like:

• Purposeful Questioning for Negotiating a Job Offer
• Three Keys to a Win/Win Outcome in Negotiation
• The Ideal Negotiator

Summary: Saying that the last offer is unsatisfactory in order to get a counterpart to make a better offer.

The idea behind this tactic is very simple. When someone makes you an offer you think could be improved, you simply respond, “That’s Not Good Enough.” Then pause and let your counterpart make the next response.

Example

Henry Kissinger, Secretary of State under Richard Nixon, was a master at this tactic. According to one story, his chief of staff once handed in a report he had written on an aspect of foreign policy. When Kissinger received the report, he asked simply, “Is this your best work?” The chief thought for a moment and, worried that his boss would think the report was not good enough, responded, “Mr. Kissinger, I think I can do better.” So Kissinger gave the report back. Two weeks later the chief turned in the revised report. Kissinger kept it for a week and then sent it back with a note that said, “Are you sure this is your best work?” Realizing that something must have been missing, the chief once again rewrote the report. This time when he handed the report to his boss, he said “Mr. Kissinger, this is my best work.” Hearing that, Kissinger replied, “Then this time I will read your report.”

Counter

The best counter for the chief of staff in this situation would have been to gain more information by using the tactic of Asking an Open-Ended Question like, “Is there anything you were specifically looking for in my report that is not there?” Or, “Is there anything specific about my report that you do not like?” Or, “Just out of curiosity, why are you asking about the quality of my work?” Or, “How do you define ‘best work’?” The key to countering the That’s Not Good Enough tactic is not divulging information until it is clear precisely what your counterpart is looking for.

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

All Negotiation Tactics

Summary: Pretending to be on a counterpart’s side while consulting another party who keeps vetoing deal points.

The Good Guy/Bad Guy technique is very similar to the tactic of the Higher Authority but is much more specific. With Good Guy/Bad Guy, one person pretends to be on your side and appears to help you make the deal. But every time you strike a deal, the good guy marches off to the bad guy for final approval. Naturally the bad guy will renegotiate the deal you have worked out with the good guy. Anytime you get into this scenario and do not expose the technique, you can end up with devastating consequences.

Example

If you have ever bought a new car, most likely you have experienced the frustration of being in a Good Guy/Bad Guy situation. After you have test-driven the car, the salesperson takes you into the closing room to draw up the initial deal. Since the salesperson cannot approve anything himself, he marches off to the sales manager to get the manager’s input on the deal. Then the salesperson returns and says that you are close, but the original deal will not work. What is scary is that dealerships go through this process whether your offer is a good one or a bad one.

Counter

First, you can fight fire with fire. The last time I bought a new car, I took my wife. Every time the salesperson went to the sales manager, I took the deal to my wife (who was in the lobby) to review it. At one point, when the salesperson told me he would have to raise the price of the car five hundred dollars, I replied that we had a problem because my wife said I couldn’t do the deal at the previous price unless I could get the interest rate down another point.

Second, you can expose the technique. Tell your counterpart that you do not appreciate the Good Guy/Bad Guy routine. I once told a salesperson that if he did not have enough authority to make the deal, he should bring in someone who did. I warned that the next time he left the room, I would also leave. Keep in mind that if the salesperson needs to get approval from the sales manager, he can make a phone call with you in the room.

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

All Negotiation Tactics

Summary: Consulting someone else before accepting an offer.

The tactic of Higher Authority can work for either counterpart in a negotiation. Sometimes you cannot get a situation resolved by working with the counterpart assigned to you. Perhaps the counterpart has decided not to comply with your request, or she may not have the authority to fulfill your request. So you have to go to a Higher Authority to obtain a satisfactory outcome. On the other hand, lacking the final say in a situation can create a very powerful position for your counterpart, since it provides her with the opportunity to take your request to someone at a higher level in the organization. We have frequently seen experienced negotiators work the best deal they can, then run off to a Higher Authority and come back with instructions for an even better deal.

Example

A real estate developer requests a line of credit from his local bank branch. The branch manager says that the loan has been denied by the loan committee (the Higher Authority) at the bank. The developer asks if there is anything he can do to have his loan reconsidered. The branch manager apologizes, but says there is nothing she can do once the committee has denied a loan.

Counter

Since the branch manager is denying that she can do anything to help the developer, he could counter by going over her head, using the tactic of the Higher Authority himself. He could call the bank president or a member of the loan committee and ask that his loan be reconsidered. In the above example, the bank president might request that the branch manager repackage the real estate developer’s loan so it could be approved.

The best way to keep the tactic of the Higher Authority from being used on you in the first place is to ask your counterpart in the very beginning whether she is the person who makes the final decision. If not, ask to make your presentation to the decision maker.

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

All Negotiation Tactics

Summary: Expressing disbelief to encourage a counterpart to make a better offer.

Successful negotiators are good at acting surprised. They communicate the YIKES! You’ve Got to Be Kidding! message with a flinch, a sour face, or an expression of disbelief anytime a counterpart mentions the price or conditions of a product or service. We used to think this tactic was rather silly until we realized how effective it was when someone used it on us! Failing to act surprised when price or conditions are mentioned could encourage your counterpart to take advantage of you.

Example

A salesperson says, “The price for printing hard cover copies of your book will be seven thousand dollars for a thousand copies.” The author responds, “You’ve got to be kidding me! Why so much? We can create an e-book for just about nothing.”

Counter

The salesperson could respond to the author’s disbelief with “Of course, that price includes typesetting, printing and a high gloss, four-color cover. Plus, not everyone has an e-reader.”

When someone uses the YIKES! tactic on you, you have to defend your product or service on its own merit. Many people flinch because they lack knowledge of a product, service, or price. So do not give concessions until you have a solid understanding of why the person flinched. Inexperienced negotiators tend to give up too much too soon.

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

All Negotiation Tactics

Summary: Holding firm on an issue.

Sometimes the most effective tactic in a negotiation is simply to say, “No, I am not going to do that” or, “That will not work for me.” This is an easy tactic to utilize, although it may be difficult for people who value being nurturing and supportive.

Example

A woman is purchasing a T.V. and the salesperson who is writing up the order states, “Almost all our customers find tremendous value and peace of mind by extending the warranty by an additional three years.” The woman responds by simply stating, “No, I am not going to do that.”

Counter

Two counters are possible, and both lead to the same goal. First, the salesperson might ask the woman if she would consider another option, like a two-year extended warranty. Second, he might try Asking an Open-Ended Question that would provide him with more information and help him understand why she does not feel the need to extend the warranty. For example, he could ask, “If the unit does malfunction in the next two years, how will you go about getting it repaired?”

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

All Negotiation Tactics