tips for business negotiation

A big item in the news this week was the nuclear deal the White House struck with Iran.  The deal itself has stirred up some controversy because many believe the administration conceded far too much to the Iranians while others are more or less happy with the outcome of the negotiations.  Time will make clear who ultimately benefits from this deal, but the firestorm surrounding this agreement gives us an opportunity to reflect on what truly makes for a successful negotiation process.  Putting into practice the following guidelines will help you triumphantly conclude your next negotiation:

1.  Start the negotiations with a clear picture of the desired outcome in mind.

The side that has a concrete vision for where the negotiation will end up will most likely be the side that seizes the initiative and guides the negotiation process.  Do your homework ahead of time and consider what the other side will be seeking, and try to anticipate how much they may be willing or able to move on their positions.  Then predetermine the maximum amount you will be willing to compromise on each negotiable point.  If you can open the negotiations with a crystal clear understanding of your objectives and a reasonable understanding of the other side’s main goals, you can more easily establish the terms of the process and, hopefully, direct the discussion to a satisfactory resolution for all parties involved.  Of course, you will want to set the agreement in writing, and you may find that it is useful to jointly write the terms of the agreement with your counterpart(s) as you go because it will save time at the end of the process and reduce the risk of the other party changing their mind before signing while they wait for the contract to be drafted.

2.  Be flexible and calm; avoid narrow-mindedness and volatility.

While it is important that you have an idea of just how far you will go on the issues being discussed, it is also helpful to avoid myopia during the process.  Avoid allowing the negotiations to boil down to just one issue.  Try to introduce as many negotiable points as you can into the process.  This allows you more room to maneuver around positions on which you have become stalemated and gives you more areas with which acceptable compromises can be made, thereby giving you more latitude to explore creative paths to a satisfactory agreement.  (For example, if a car dealer won’t lower his price on an automobile any further but you don’t feel that you are necessarily receiving a good deal, see if they will include free oil changes and car washes for the life of the vehicle.  They may see the opportunity to perform some routine maintenance on the car as a gateway to sell you on pricier repairs while you see the potential to save money in the long run.)  Additionally, it is essential to remain composed during tense periods in the negotiation process if you want to avoid alienating the other side and bring the deal to an acceptable close.  Good negotiators allow reason to rule over passion at the conference table.

3.  Do not be afraid to walk away or to allow the other side to walk away.

Generally speaking, you do not want to accept the first offer made because the other party may simply be offering you something that they think you will turn down to see how committed you are to certain positions, price points, etc.  During the negotiations, try to establish a level of trust through honesty, transparency, and fairness; this will increase your chances of striking a deal and maintaining a relationship in the future.  When doing so, however, always try to deal from a position of strength  (or the semblance of strength) so that you give the other party less reason to believe that you will compromise, which will probably mean that they will seek fewer compromises from you.  But remember that your ultimate bargaining chip is your ability to walk away from the table.  Do not accept terms that you find unsatisfactory because the chances are that there is somebody else out there who would be happy to compete for your business.  By the same token, if negotiations begin to stall, you can put forth your best final offer and give your counterpart(s) the same opportunity to walk away from the table.  Do not get desperate and risk being taken advantage of if your conditions are not met.  Failing to reach a deal is often preferable to entering into a bad deal that you cannot get out of, especially if that deal carries serious repercussions down the road.

Negotiating is a difficult task.  It can be a mentally and emotionally draining process.  Lengthy, high-stakes negotiations can even take a physical toll on the participants.  Nevertheless, adhering to these simple guidelines will make you a more successful negotiator and increase your odds of securing a favorable agreement, no matter the topic at hand.  So whether you are discussing nuclear armaments or flooring for your kitchen, try employing these techniques to ensure better results.

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