Negotiations are important for any aspect of life. Sometimes you have to negotiate business deals, what’s for dinner at home, or a sale for a product. Being such a large part of life, it’s important to understand what negotiations are and how to do them well.
A negotiation is an agreement among more than one party in regards to a specific topic. People use negotiation in business transactions to find a price or terms to settle on, with family to decide what’s for dinner or how to resolve an issue, or even in sales to find an agreeable price for a product or a home.
Almost everyone uses negotiations on a daily basis, whether at work or at home, and should be able to negotiate well. How do you know if you’re negotiating well? Based on how many time you negotiate and get what you want from it determines whether you negotiate well.
Negotiating With Family
Negotiations with family are more difficult than any business negotiations you could face. It’s much easier to stand firm in a business negotiation than it is with a loved one. How do you negotiate with family? Understanding these difficulties can help:
- Expectations are exponentially higher
- Logic is more difficult to tolerate
- Quicker to react
- More focused on yourself
- Get ahead of yourself
Having these concerns in mind can make negotiations easier. You can address these issues in advance and understand what your loved one is thinking or feeling while you’re trying to negotiate.
Focusing on expectations can be difficult. It’s important to focus on the things you already know about them and work from there to discuss the problem and reach an understanding and agreement. From there, you can move forward with negotiations to find a solution to the problem.
Working with logic from a loved one is harder than working with logic from a coworker. It’s best to try avoiding logic in any negotiations with a loved one. Hearing logic from someone you care for is usually harder to handle than having them yell at you. It’s important to try focusing on empathy and labels instead of logic when trying to provide answers and explanations.
Negotiating with loved ones raises our reaction time. It’s easier to be sensitive to tone and words from a loved one than a coworker. Focus on understanding that can help avoid an argument during a negotiation. It’s important not to assume certain meanings based on words or tones when your loved one is speaking. Remembering to keep your calm can help you stay focused on the negotiation at hand.
Focusing on yourself during a negotiation with a loved one is similar to playing cards: focusing on your hand causes you to miss what someone else might play. It’s important to pay attention to what your loved one is telling you. Don’t let your own thoughts and feelings keep you from understanding their needs.
Getting ahead of yourself can cause issues for negotiating later. If you’re already set that an outcome will occur or you’ve stopped trying to resolve the outcome, you’re breaking the connection you gained from communication and understanding. You’ll need to mend this connection before you can move forward in negotiating to resolve the issue.
As a buyer, you strive to purchase products at the best prices available. Sometimes this can mean having special negotiation skills to get a top price for the product or service. These skills can help you negotiate top prices:
- Whack back
- Sticker shock
- Cherry picking
- Pencil sharpening
- Going, going, gone
Anchoring provides a price range for negotiation. For example, telling the seller you want to spend no more than $100,000 for a product or service caps the negotiations at that price. The seller now understands he or she can’t go higher than this price or they’ll lose the sale. It’s an important tactic to keep negotiations in a price range you’re comfortable with.
The whack back is a tactic used by many buyers to push the seller down. It’s a simple “your price is too high” comment to try forcing the seller to lower the price. Most sellers will ask why and try to refute your reasons.
Faking, or seriously having, sticker shock is another buyer tactic. This shock over the price is a hard hit to the seller to make them question their pricing. They might ask why it seems high and try to refute your reasons to keep the price at their level.
Cherry picking is a buyer tactic that can offend the seller. It’s the buyer’s way of getting less product at the same bulk cost. For example, if they ordered 50 shirts and the price came to $2.00 per shirt because of the bulk order, they might try to take 20 shirts at the same bulk price, still paying $2.00 per shirt.
Sometimes negotiators use a tactic called pencil sharpening to try forcing the seller to drop the price by using phrases such as “You need to do better” or “We need this for less.” It’s a way to make the seller feel as though they have no choice but to lower the cost or ask the buyer where the price should be in an attempt to keep them happy and sell.
A final, and harsh, negotiating tactic is the going, going, gone test. It’s the buyer’s way of pushing the seller into a corner with a time crunch. In this tactic, the buyer informs the seller they will be going with a competitor for the product or service if the seller doesn’t agree with the buyer’s price by a specific time and/or day.
People use these tactics in price negotiations on a regular basis and they can sometimes make them tougher to agree on.
Negotiating in business can mean a lot of things. Maybe you’re negotiating a deal or a job offer. The tougher of the two is generally a job offer and can mean the difference between having the job you deserve and having the job you took. There are ten main rules to follow when negotiating for a job:
- Get it in writing
- Keep the door open
- Information is power
- Be positive
- Don’t make decisions
- Have options
- Have reasons for everything
- Be motivated by more than money
- Understand their values
- Be winnable
Rule number one says everything should be in writing. In today’s society, people are continuously changing their minds or forgetting what they said. When negotiating for a job, that’s a bad thing. It’s imperative to write everything down as you go. This is a promise to remember every detail in case you need to reference it later.
The second rule is to keep the door open. This one isn’t quite as self-explanatory. It means to hold on to your negotiation power. Don’t give up your power to negotiate the best terms until you’re 100% ready to make a final decision.
Information is the key to the third rule. Don’t give up too much information until you’re ready to agree. If you’ve negotiated every aspect of the job and decided this is what you want and you’re ready to say yes, then go ahead and provide all the information they want.
Positivity makes rule four an important one. Being positive is your most valuable asset. Never seem like you’re getting angry or losing your temper. It’s important to keep a level head and stay positive in order to have the best negotiations. If the person you’re working with feels you’re losing your positive attitude, he or she may feel they’re winning and you’ll settle for whatever they want to give you.
Being the decision maker is what brings rule five into play. It’s important not to be the decision maker in a job negotiation. Be sure to confirm all the details and make it seem like they have the final say in your decision to accept the job. It’s also an option to confirm details and compare this with other offers before making a choice.
Options are important for job negotiations. If you have more than one job offer, you can play this to your advantage to negotiate a better offer for the job you truly want.
Options are also a good way to have reasons for everything, as rule seven tells you. It’s important to have a reason to back up every answer you provide. Without reasons, they believe they can force you into the job terms they want instead of the ones you want.
Money isn’t everything. While it helps to have money, that shouldn’t be your primary focus in choosing a job. Focus on the important benefits or the work environment and worry about the lowest amount of money you’ll settle for if everything else fits.
The values of the company can help you negotiate a better deal. Understanding what they strive for can give you a few selling points to negotiate yourself better terms if you can prove you have those values as well.
Make them want to win you over. Being winnable is about more than just winning the negotiation. It’s always a great feeling when the company feels they have to win you from the competition and they try to do just that.
Still unsure about your negotiation skills? Shapiro Negotiations has a team of experts waiting to help. Their knowledge and training allows them to help you become the best negotiator you can be. Contact them now for more information.