When negotiating…


Everybody needs to negotiate from time to time; at work, at home, as a leader, as sales person, and as a consumer. For some it seems easy, but others view the process of negotiation as a source of conflict to be resisted and avoided if possible. Negotiation is a process and a skill that can be developed.

Negotiation can be described as a process that involves two or more people dealing with each other with the intention of forming an agreement and a commitment to a course of action where compromise needs to be reached in order to move forward. In a sales environment, not every sales situation needs negotiation however when a compromise needs to be reached negotiation often involves a series of communications between two parties to form an agreement about the details of a sales solution.

In many cases, it is possible for a proposal to be generated that satisfies the needs of both parties this is called a Win-Win.

Win-Win: In this approach, both parties go into a negotiation or transaction with the intention that they will give something towards the transaction in order to receive what they want. This is the strategy that has the best formula for success.

However, sometimes one or more parties may have to accept less than they had hoped for when they entered the negotiation process. This is when you come across the Win-Lose.

Win-Lose: The second approach has a good opportunity for success given one party is open to giving in order to receive, therefore paving the way for the sale to proceed. Both parties are open to giving, although the second party will give only once they have received. However where this approach can fall down is when Party B waits too long, wanting to receive as much as possible. If they wait too long, Party A may decide they wish to reconsider and a stalemate could ensue. In the worst case scenario the fulfillment of one party’s wishes may come entirely at the expense of the other party’s.

In a Lose-Lose situation both parties are unwilling to give before they receive. This approach is the least effective when it comes to negotiation, given that it is easy for a stalemate to arise. Unless one party is willing to take the risk of compromising, there is likely to be no negotiation.

Therefore, negotiation is the process of navigating your way through each of these alternatives, ideally aiming to come to an agreement that is complimentary to both parties’ needs. So here are tips to help you navigate you way through negotiations.

Helpful Tips

  1. Develop ‘negotiation consciousness’: Successful negotiators are assertive and challenge everything. They know that everything is negotiable.
  2. Become a good listener: Negotiators are detectives. They ask probing questions and then remain silent. The other negotiator will tell you everything you need to know – all you have to do is listen.
  3. Be prepared: The boy (and girl) scouts were right. Gather as much pertinent information prior to the negotiation. What are their needs? What pressures do they feel? What options do they have? Doing your homework is vital to successful negotiation.
  4. Aim high: People who aim higher do better. If you expect more, you’ll get more. Successful negotiators are optimists. A proven strategy for achieving higher results is opening with an extreme position. Sellers should ask for more than they expect to receive and buyers should offer less than they are prepared to pay.
  5. Be patient: This is very difficult for some people. We want to get it over with. Whoever is more flexible about time has the advantage. Your patience can be devastating to the other negotiator if they are in a hurry.
  6. Focus on satisfaction: Help the other negotiator feel satisfied. Satisfaction means that their basic interests have been fulfilled. Don’t confuse basic interests with positions. Their position is what they say they want. Their basic interest is what they really need to get
  7. Don’t make the first move: The best way to find out if the other negotiator’s aspirations are low is to induce them to open first. They may ask for less than you think. If you open first, you may give away more than is necessary.
  8. Don’t accept the first offer: If you do, the other negotiator will think they could have done better. They will be more satisfied if you reject the first offer because when you eventually say “Yes”, they will conclude that they have pushed you to your limit.
  9. Don’t make unilateral concessions: Whenever you give something away, get something in return. Always tie a string “I’ll do this if you do that”. Otherwise, you are inviting the other negotiator to ask you for more.
  10. Always be willing to walk away: Never negotiate without options. If you depend too much on the positive outcome of a negotiation, you lose your ability to say “No”.

Remember everybody lives by selling something.

(article by S.Barrett)

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