If you are planning on being successful, you will have to master the art of negotiating. The idea is to make the other party believe they are getting as much as you are (or more). We are not talking about ripping people off. Quite the opposite in fact. The trouble is that often you may offer value which the other party can’t recognize. As a negotiator, you must show the other side the value of your offer.
Of course negotiation is a skill, and therefore it can be abused. It is possible to deceive people into believing that there is value in places that have none at all. Therefore, some may try to device others.
However the problem with deceiving, is that even if you can pull it off successfully, it’s not an act you can repeat. Sure, you can make a quick buck, but to build a big, strong, successful sustainable business, you will have to repeat business with various parties. So you need to strive for a win win situation.
We actually negotiate all the time in our day to day life without even noticing. We negotiate over the price of the car we bought, we negotiate with service providers and we negotiate with friends, trying to persuade them to see the movie of our choice. The only question is, are you any good?
Here are a few tips that might help you out:
1. Know your bottom line
It is important that before you enter the negotiation, you know your bottom line. For instance if you are selling a product that costs you $10, there is no way you can sell for less than $10. It might be worthwhile to sell at $10 in order to secure new clients, but that is another story altogether.
2. Aim for a win win outcome
Always strive for an outcome that will make everyone happy. Smashing the other party when you have the upper hand will be great in the short term, but tables can turn. Act in good faith, and when you’re in a tight spot, hopefully you will be treated the way you deserve.
3. It’s easy to come down, impossible to go up
This rule is of the upmost importance. You can always come down, but you will never be able to go up. If you are trying to sell your car, and mumble out that you will take $20,000 for it, that’s that. It is now impossible for you to get anything above that price. Remember that once you spit out a price, it is effectively binding. It can be reduced, but it can’t be raised.
4. Be prepared to leave the table
There is a reason we said “be prepared”. This means having a backup plan. If you can’t get your way, walking away might get you what you want. The other party may break and give into your demands just to keep you at the negotiation table. This is basically a bluff, which may or may not be called. If however you walk away, be prepared to follow through. Have a backup plan that will actually allow you the leave the table and still keep a few options open. If you walk away and then come crawling back you will look like a fool.
5. Know exactly what you want
This seems obvious but is usually overlooked. For instance, if you are going to get a new car. It’s not enough knowing that you want a new BMW 3 series. Know ahead of time exactly what model you want, exactly what options you want and exactly how much you are willing tot pay. Walking into the dealership with a plan to “get a good deal on a new BMW” isn’t going to workout in your favour. How can you aim for a goal if you yourself don’t know what it is? Sit down with yourself, define what it is you want and go for it.