Eight Tactics That Will Help You Win Any Negotiation
April 7, 2007 By Matthew Paulson
We all have to hone our skills in the art of negotiation. We’ll need to learn how to negotiate so we can get good prices on our major purchases, be able to come up with business deals, find solutions with coworkers, and more. Negotiation is a part of life that you can’t ignore. Here are some great tips to help you with negotiation in your every-day life.
Be Willing to Negotiate – You have to be willing to negotiate for any good to come out of it. Don’t be too shy to talk about money and just accept whatever price that you’re offered on the outright. Most skilled negotiators will take advantage of someone who’s timid and make them pay full price. You have to want to negotiate so you can get a better deal. Sometimes you’ll get a better deal just by asking for one. When I was buying flowers for my fiancé, I asked if they had any sort of discounts I could get, and then I got 10% off just for asking!
Don’t Get Overcome by Emotions – A lot of negotiators who are not very experienced become way too involved in the situation emotionally, and make it all about winning, which gets them in trouble. They’ll shout, demand, and threaten to get there way. In order for a negotiation to be successful, both parties have to feel like they’re getting a good deal. Be calm, and willing to compromise a bit.
Don’t Follow the Rules – A lot of people will tell you that they’re not allowed to do something because of company policy, or because that’s the rules they were given. They’ll tell you that they can’t give you that good of a deal, or can’t change that in a contract. If you’re signing your name, you can change whatever you want to the contract, they can not accept if it they please, but that’s their prerogative. Don’t accept that you’re not allowed to do something because “it’s the rules.” If they tell you that company policy says otherwise, demand that to talk to someone who can change the company policy or bend the rules.
Don’t Name a Price First – Never be the first person in the negotiation to name a price. You want to know what they’re thinking well before you name a price. If you name a price first, you could easily be walking into a situation where you are giving the other person a fantastic deal, and you might not even know it! If they were expecting to pay you $500 for some work, and you offer to do it for $100, there’s no way they’re going to pay what they had originally intended. Instead ask what the budget is for the contract, this’ll make them name a price first.
Ask for more than you expect – After you get an offer, say things like “that’s not good enough, and “you’ll have to do better than that.” Don’t be mean or aggressive about it, just say it calmly, and you might get more than you expected. Even if you get a very good offer, you can ask for more than you want. This way your counterpart will feel like they’re lowering your expectations and making you give up a little even though you weren’t giving up anything at all.
Pretend it’s someone else’s decision – Before you finalize a negotiation, tell them that you’ll have to talk it over with the boss, or your supervisor before you can agree to something. This will do a couple of things for you. First, it’ll stop them from rushing you, since the decision isn’t “yours’ so they’ll have to give you some time to get things done, and second, it’ll encourage them to sweeten the deal. If they think it’s not up to you, even though you’re sold on the idea, they’ll have an incentive to sweeten the deal to make it more likely that the authority figure will accept the deal.
Don’t be too interested – If you give them the impression that you’re very interested in the deal. This will enable them to get a lot more out of you than you want to give, because they know you’ll agree to whatever they want, because you are very interested.
Don’t Let them Feel Cheated – If they feel cheated when the negotiation is done, they’ll never want to negotiate with you again. They also might not fulfill their part of the deal. You want to make them feel like they’re getting a decent deal, regardless of how good it actually is.
If you don’t know basic negotiation techniques, someone who does will out negotiate you and cause you to lose out on a lot of money!
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April 16th, 2007 at 12:24 am
Lots of good points, however I disagree that you should never be the first to name a price. The person naming the first price has the advantage of anchoring the other person’s expectations.
Your concern about naming a price that is too low / too high is a very valid one. To avoid making such a mistake, a negotiator must do his homework before hand, and know what the range of acceptable options are. He should then proactively take charge of the situation and anchor the other party’s expectations at a value that is more favorable to him.
By waiting for the other party to name their price first you are giving up that advantage. A counter example to the one you give: if they say that they intend to pay you $100 but you were going to ask for $500, their expectations are already anchored and it will be tough to get them to increase the offer by that much.
April 16th, 2007 at 3:13 am
To Shadox, I agree with you and disagree with you. When in a professional setting like in a job interview it probably makes more sense to me that you want name a figure and take control of the negotiation. If you keep asking them to make the first offer it can often make them feel that you want to extract max. out of them and do not care about the job at all.
However if you are negotiating with a car dealer for buying a car then you should always be prepared to let the dealer make the first offer.
And hence add another point to the list: (Almost) Never accept the first offer.
-Gaurav
April 17th, 2007 at 12:30 pm
How hard you negotiate can also depend on the situation. In particular, maintaining good will is more important in situation where you will have an ongoing relationship with the person or company you are negotiating with.
When you are negotiating for a raise or promotion, you already have a relationship with your employer. Presumably, if you are in a position to ask for more money or advancement, it is a good relationship. You don’t want to do something that jeopardizes that. You are negotiating for how much of the difference between what you are currently paid and what you produce for the company you are going to get.
On the other hand, when you are negotiating to buy a car, you are negotiating to get the best price. The dealer is competing with the other dealers in the area to get your business.
The consequences of either party walking away from the negotiations before the deal is completed are very different in these two situations.