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Summary Negotiation is getting what we want from people who want something from us Preparation on all the issues is everything All negotiations should revolve around the word IF Its about movement from both sides to a common acceptable agreement Be firm but flexible; polite and clear; cool and rational Nothing is agreed till everything is agreed Avoid changing the price. Change the proposal/package
Negotiation Tips Spot tactics as tactics: dont react emotionally Final often does not mean it. Finalish : Forever-for- now AII negotiations can be renegotiated Price is one aspect: there are other satisfiers It’s not how much you concede but how you concede Leave the other person thinking they got a bargain Beware "funny money" (odd promises/offers) Remember long term relationships Watch out for last minute problems Get written contracts
Phase 1: Preparation - What Do WeWant? Decide which crucial issues need addressing Define your wants for each issue Rate how important each want is Assign ranges of possible values to each issue/want (entry and exit position). Know your BATNAs Record preparation details Start thinking about the other partys wants and priorities Try the same strategy for their wants
Phase 2: Debate - What do they want? Use debate/discussion to gauge the other partys views/wants Use open questions, clarification, active listening to discover their entry position and all subsequent positions. Be curious, listen carefully Avoid saying no. Ask a question rather Regularly summarize what you here the other party proposes before responding. Precis your understanding of their position Avoid discussions around beliefs, values, principles, opinions communicate your wants and find out their wants. Concrete not abstract Look for signals of movement-qualifications attached to a statement-get the other party to expand on their tentative hints
4 Key Questions in Every Conversation What are they asking for? Goal What do they want? Need What will they accept? Resistance Point At what point will they walk away? BATNA
Phase 3: Propose - What Wants Could WeTrade? Analyse your competing wants Make your proposal conditional - the condition and the offer Be flexible-but always conditionally State your proposal-then shut up! Listen If responding to a proposal - summarize, clarify, ask open questions-dont instantly reject Offer a considered, alternative, perhaps compromise, proposal Between two converging considered proposals is a potential settlement and agreement
Phase 4: Bargaining The precise terms on which both parties would settle All bargains should be expressed as a condition and an offer. If you ... then we .... Different from Proposal as it is precise and you are seeking a yes If offer rejected, require other party to propose reasonable alternatives If responding, make a conditional counter-offer bargain (you may return to debate phase) Keep whole deal together-all issues linked in the one package Remember nothing is agreed till everything is agreed
Agreement Closing techniques When: Greedy is worse than needy-have you got what you want? How: Conditional traded movement close to clinch Summary close Adjournment close Either/or-useful if within budget constraints Agree what you have agreed: Each issue which has been subject to negotiation should be summarized and the summary agreed between the two parties, Follow up in writing. Check sensitive phraseology at this point
Pricing Issues Never change the price - change what is offered Identify all the negotiable tradeables in your business Money always involves numerous issues and emotions Stress the value of ownership versus the cost of purchasing Stress the value of the service versus the cost of the service Stress the value of long-term benefits versus the upfront costs Stress benefits rather than features Listen to how they talk and think about money
False Assumptions The buyer is usually all powerful The buyer knows what he/she wants The price is always the central issue Competitors dictate your limits More authority is better in sales Price cutting is the most powerful weapon
The Real-World Law of Time Pressure 90% of all concession making is done in the last 10% of time spent negotiating Furthermore, one of the two parties is ALWAYS under greater time pressure ...