Deal or no deal?
For many people, the mere fact that the transaction they are about to undertake is named ‘negotiation’ causes them to feel uncomfortable and creates stress, but negotiation isn’t just a business concept for managers and salespeople – negotiation skills can be applied very effectively in all areas of your life.
In life, as in business, you don’t get what you deserve, you get what you plan, prepare for, and negotiate. We negotiate every day – with our colleagues, family members and friends. People fail to realise that many of the interactions we engage in are a form of negotiation. Many of us dislike negotiating because we are afraid of being taken advantage of. The outcomes are not always what we expect and we don’t always win.
Effective negotiation can be fun and rewarding if you know what you are doing, and the ability to negotiate effectively is crucial in today’s challenging business world and in your private life. Here are a few tips you can use to improve your negotiation ability:
- Develop ‘negotiation awareness’
Be aware that most things are negotiable. You have the right to question the asking price for most things. Don’t necessarily just accept the recommended or list price. I don’t mean that you must aggressively challenge everything, but develop an assertive or enquiring approach. You will be surprised how this will get you more of what you want for less. Practise expressing your feelings without fear or anxiety. Be assertive, but always remain respectful. I find that most of my negotiation successes are achieved with firmness, charm, and a friendly smile. Anyone can do this!
Gather as much relevant information as possible prior to the negotiation. It helps if you have the ability to think on your feet, but I always feel more comfortable if I have researched the questions regarding price, needs, options and any possible conflict.
- Know the bargaining arena
You and the other person both have ideal, realistic and fall-back positions. The bargaining arena is where your positions and their positions overlap. Having a clear understanding of the bargaining arena will keep you focused and realistic about what you and the other person can bargain.
- Know your desired outcome
Your outcomes need to be specific. If you are not clear about what you desire then it is likely that you will get something else. Clarity and focus is the key.
- Aim high
People who aim higher do better. A successful negotiator must be an optimist. Expect more and you will get more. Sellers should ask for more than they expect to receive, and buyers should offer less than they expect to pay.
- Listening skills
A big contributor towards success in negotiations is to listen. Listen carefully and let the other person talk. Encourage the other negotiator to talk by asking open-ended questions. These are questions that can’t be answered with a simple ‘yes’ or ‘no’. Active listening will help you to understand the facts and implications of the other person’s proposal. You will also understand some of the feelings and motives of the other negotiator.
- Ask questions
Asking the right questions is a powerful negotiation tool. When you need information or clarity, ask a question. If someone is angry or emotional, ask a question. Make sure that your questions are conversational and not an interrogation. Effective questions give you time, direction and a subtle sense of control.
- Always aim for win-win
Negotiation is not a contest. Most people look at negotiation the wrong way. The principle of win-win negotiating is that there is always a bigger and better deal for both parties if they are willing to search for it. Create a collaborative and not a competitive environment at the start of every negotiation process.
I am confident that these ideas will benefit you in your future negotiations.
‘You must never try to make all the money that’s in a deal. Let the other fellow make some money too, because if you have a reputation for always making all the money, you won’t have many deals.’ – J. Paul Getty