3 Fundamental Truths to Successfully Negotiating a Deal
Monday Sep 24th, 2018
They say negotiation is a delicate process. I disagree. Negotiation is about skill, strength, and strategy. Like anything else, it can be natural-born, developed over time or learned through education and research.
But either way? Negotiation is a necessary skill that will serve you throughout your life.
If you’ve been following along from the start, you’ll know I’m always here for the restaurant puns so start sharpening up your skills on these 3 fundamental truths to successfully negotiating a deal — they’ll serve you well.
Rule No.1: Start with kindness above anything else
As they say, you get more flies with honey than you do with vinegar and in a negotiation there’s a strategic purpose for this mantra. If you go into a negotiation with an intense, abrasive attitude and an inability to compromise right from the beginning, you’re only going to make the other party want to respond in the same way.
The same way that mirroring happens in our personal relationships, we have the opportunity to reframe our interactions in a positive way so that we get the result we’re looking for.
Rule No.2: Learn your opponent’s intentions
Whether it’s a buyers or a seller’s market, part of being prepared to negotiate means trying to learn the other party’s intention. You’ll want to find out why they’re selling their home or in the market in the first place, and this will help you formulate a solid strategy when making certain asks on your end of the negotiation.
If you know they’ve already purchased another property with the conditional sale of their current home, you have an opportunity to leverage the sense of urgency to be competitive with your offer. On the flip side, if you also know that they’re just dipping their toe in the water to get a feel for the market, you might not want to low-ball them early on.
The key to discovering the other party’s intention is to ask open-ended questions and get the other side talking. Until the other party has revealed why the want to negotiate and what their intentions might be, it’s difficult to close the deal.
Rule No.3: Always be prepared to walk away.
If it comes to this, always be prepared to walk away. One of the most important elements to negotiation starts with being prepared, from beginning to end. It’s always smart to have an idea of what outcomes you wouldn’t accept before you’ve even entered the conversation.
Making a bad deal, getting caught off-guard or buckling under pressure are all opportunities to make a misstep or accept a deal under pressure. To avoid that, identify a few outcomes that you would walk away from if they were thrown on the table. This gives you an idea of what your boundaries are, and an opportunity to combat the offers if you already know which outcomes won’t suit you.
If a deal doesn’t suit you, your best rule of thumb for saying no without saying it so explicitly, is to ask the person, “How am I supposed to make that happen?” When you reposition the onus on them they’ll be required to respond with some sort of solution to the very problem that they’re proposing. Once they start offering up their solutions, you’ve just gained yourself leveraging power. You’re able to strategically decline their offer, keep the communications lines going — all without taking your cards off the table.
Next time you’re heading into a negotiation, start with these three fundamental truths to give you a baseline for how to navigate the negotiation process. Knowledge is always power and at the end of the day, it’s the person with the most options that has the most leverage. Exercise yours with these three rules and you’ll be well positioned for closing a deal.