In our negotiation video, 10 Tips to Create a Win/Win Outcome in Negotiations, we spoke about the first five tips to create a win/win outcome in a negotiation:
- Remember, everything is negotiable
- You need a compelling, positive vision
- Advance preparation is critical to your success
- Ask great questions
Here are tips six through ten.
- Set a goal for each negotiable deal point. For every negotiable issue, you need to determine a goal of what you want as an outcome for this deal point. Once you determine your goal, you need to identify your wish to open the negotiation.
For example, if your goal is to purchase the item for $1,000.00, you will open the negotiation with your wish of $850.00. If you open the negotiation at your goal of $1,000.00, you will always be negotiating on the wrong side of the fence (higher than $1,000). Also, it is important to identify your bottom line. If the price on this item cannot be bought for less than, $1,100.00, you will walk away from the deal.
- Aim Your Aspirations High. If your goal is to buy the item for $1000.00, significantly raise your wish to open the negotiation. Think in percentages. Should your wish be 10 percent ($100.00 off the price) – an opening offer of $900.00? Or should you raise your wish even higher? Should your opening bid be a 25 percent wish and offer $750.00? Raise your level of aspiration to the point you feel a little uncomfortable. You will know you did not raise your aspirations high enough when you say, “Will you take $800.00?” and they extend their hand and say, “Sold.” That is when a 30 or 40 percent wish would seem to be even more appropriate.
- Develop Options and Strategies. The most difficult people to negotiate with are unilateral thinkers. It is their way or the highway. What makes them incredibly difficult is they have no options or alternatives. If you can ever figure out how to effectively roadblock the unilateral thinker’s only option, they are highly ineffective as a negotiator. We recommend coming up with three options and alternatives. With three, you can almost always achieve a win/win option. If your counterpart finds one of your alternatives unacceptable, no problem, you have another one or two alternatives available to you to make the deal work.
- Think like a dolphin. Both carps and sharks believe that what you negotiate in life is a finite number. The carp’s goal is to minimize their loses because they believe that you are going to take what is rightfully theirs. The shark also believes that life is finite but their mission in life is to take everything on your plate, leave you in tears and feel absolutely no remorse. The dolphins are highly effective because they negotiate well with both carps and sharks. If a shark ever exhibits a mean behavior on a dolphin, they don’t sit back and take it. They retaliate by ramming their bulbous nose into the ribs of the shark to give them feedback that the behavior is unacceptable. We don’t recommend that you retaliate.
The key to successfully negotiating with a shark is to remove a deal point you had previously agreed to. For example, let’s say that your counterpart just informed you that they will buy one-half the quantity they originally agreed to but they want to keep the same low price. In this case, the most effective strategy is to remove the low price from the table and submit a different price, terms and/or conditions. If you do not remove something, sharks are pre-programmed to try and get even more from you to bolster their side of the deal.
- Be Honest and Fair. Very few negotiations are one time affairs. I believe that in life, Karma applies…what goes around comes around. This means I believe that you have an obligation to help your counterpart also achieve their needs and goals. When both counterparts achieve their needs and goals, and both counterparts are willing to come back to the table and re-negotiate with each other at a later time, you have achieved a win/win outcome.
It is important to remember that the only time you ever get points with your counterpart for being honest and fair is when it costs you something to be honest and fair. When you tell your counterpart that they did not add their figures correctly and they are off $1000 in your favor, you will gain points for being fair and honest.