Buying a new house? Maybe a new car? How about asking for a raise. All of these have something in common beyond terrifying a lot of people. The art of negotiation is an often overlooked skill. If I could give everyone sage advice on the topic, I would. Instead, I reached out to my buddy Chris, who deals with negotiations all day every day. This guy could get you a good deal on most everything. The nuances are important. Here are a few of Chris’s main points that we discuss that will help you keep thing in the right perspective:
1. This is probably the most important idea Chris tried to get across – Every negotiation, in any environment, should try to result in a win-win situation. Do not try to “beat” your purchaser or seller, an insulting offer from you can quickly turn into an equally insulting counter-offer and the termination of a deal.
2. Do your research. This always seems like a no-brainer, but it can’t be stressed enough, and it is important to know WHY you are doing the research. Doing the research will give you things you can talk about and point out to gain leverage to get a better price.
3. Have some backup plans. If you are in love with just one car, or one house, your negotiations could potentially suffer. Having plan A, B, and C will increase your bargaining power, and allow you more places to concede certain items to obtain the highest number of your must-have items/features overall.
4. Keep your cool. Being short with the salesman, or condescending with your buyer is not a way to show strength. As Chris has learned over many years, a good relationship and a good conversation is better than a good price in a lot of situations.
5. Know your buyer. Any information you can gain about the needs of your buyer will help. Asking “soft” questions to get the ball rolling is a great way to learn what a potential buyer really wants. If you can determine that he or she hates not getting a real person on the phone, that can be used to your advantage.
6. Think about the fringe. In a lot of job/salary negotiations, there are tons of perks that can be hidden behind a dollar figure. Getting more flexibility to work from home, extra vacation, or having more autonomy are all things that can improve your quality of life as much or more than another could grand. Think about all of the things other than money, and value them before you talk to your employer. Be prepared to give things up and gain some others.
7. Know your goals. Now that you have all your options lined up, make sure you think hard about which ones are really your favorite. Have a solid ranking system in place and stick to it.
8. Think about how you respond to the offer you are putting forward. If you wouldn’t consider an offer, why should anyone else?
9. Be prepared to do what you say. If you threaten to walk, you better be able to. Don’t “play too hard of ball”.
10. Read up. Practice. Chris gave some good resources in the podcast you should check out. amanet.org, karrass.com, impressionmanagement.com, kbb.com, daveramsey.com.
You can gain a lot of things by negotiating with a cool head, and a lot of options. There isn’t a magic bullet on how to get a car 50% below sticker, but you can certainly do your part to get closer. Think about your interactions using some of the above guidelines and you’ll give yourself a good shot at a win-win .