Two rules to negotiating

Too often, we are faced with a negotiation. For some of us, they are difficult because negotiations are an art form.  Just like someone knows calculus, negotiating is an area of study that some have mastered while others have not.

To negotiate with a master is a waste of time. The apprentice gets chopped in two offering more than they should. It's not their fault. They don't know the difference.

There are two valuable lesson to be learned in negotiating.  I know these two rules because I've broken them so many times and have come out on the wrong end of a deal too many times to count.

Rule number 1: Never be too quick to make a deal.
Although I believe a deal can always be worked out, I'm positive and proactive when I want to move forward on a project. I jump too fast and always put my best foot forward.

This leaves me with no "wiggle room" and I end up settling for a deal that is less than ideal

The greatest lesson I ever learned in negotiating is the use of "No" as the starting position. This works  like gold when someone is approaching you with an offer, a proposition or a product. If the approaching party is really interested in what you have, they will come back with a better offer. If not, they will go away not wasting any more of your time.

In most cases, I'm the approaching party so I see this strategy a lot.


Rule number 2: He who speaks first loses.
If you're trying to negotiate a deal, let the other party speak first.
Offer a leading question to continue to get more out of the opposition. Learn more about their style and worry less about the offer. The more you learn about their style, the quicker you are able to use it to your advantage.

I've never been accused of not liking the sound of my own voice, so rule two is also hard for me. It's awkward. It feels like I should say something when it gets quiet, but I don't. And the longer I wait, the more anxious the other party gets. The discomfort goes both ways. My discomfort is expected and calculated.

One time, I had a house for sale. The listed price was a bit high for the market but I got an interested party. He approached me with a low-ball offer about $50,000 less than the list price. I told him to go back and re-work his numbers. I wasn't interested in negotiating with him. He asked me to come down in price. To which I said, I will treat you as serious when you start acting it. I instructed him to go home and if he was still interested to give me his best price. No more negotiating...

It pissed him off. He walked out of our meeting but called me two days later with a very reasonable offer.

Whether you're selling a house, a car, a product or a business, never forget these two rules. They will save you time and money if used properly