During a negotiation, it would be wise not to take anything personally. If you leave personalities out of it, you will be able to see opportunities more objectively. Brian Koslow
From deal making to buying Gucci purses in the streets of New York, negotiating is a part of life. And yet, many of us are so uncomfortable with it that we cave in and agree to anything!
Some cultures are trained to be ruthless negotiators, and certain areas of America contain more skilled negotiators than others.
I have never been very comfortable with negotiating. Shopping trips to Mexico would have me paying more than I should just because I don’t enjoy the game of talking someone down on a price. After all, I don’t mind paying a little more for a box of Chiclets if it means a poor street kid will eat better that night.
But, when it comes to survival in business, I’ve had to learn to negotiate. I’ve read books such as Getting to Yes and I’ve taken negotiating workshops through Karrass, Inc. And though I’m not the most aggressive negotiator, I have learned to keep up with the best of them.
Just as there are guidelines to cooking a turkey, there are guidelines to negotiating. These basic guidelines will help prevent you from making a big mistake during your next business deal:
- Research Before the Negotiation: Do your homework. In a business deal, you want to find out as much as you can about the company and the people you are dealing with. This will aid in your negotiation.
- Know your Numbers Before the Negotiation: Go into a negotiation knowing what you want. If you don’t know what you want, you’ll never get it! Write down on a piece of paper three things:
- Your desire outcome;
- Your drop dead lowest outcome that you will agree to if you have to; and
- Your Deal Breaker, which is the outcome that will cause you to walk away from the deal.
- Ask for What you Want: Often, a client will pay or give more than you thought. Don’t be afraid to ask for what you want.
- Talk less, Listen More: Understand where the other party is coming from. Ask a lot of questions so that you know what their concerns are and their needs are. Sometimes it’s not what you think.
- Concessions should be Tit for Tat: Make sure that if the other party asks you to make a concession (give something extra or take less money), that you are given something extra in return. In business deals, you can get very creative with this. Ask for free advertising or extra products or plane tickets, etc. Avoid granting concessions without anything given to you in return.
- Change your Offer if Need Be: Often we are wary of changing our offer in the middle of the game. But sometimes it’s necessary, especially when the deal has changed and new information is gained during discussions. Don’t be afraid to withdraw something you offered earlier, if it makes sense to do so now.
- Brainstorm to make the deal fair to all: The best deals are ones that have never been done before, so says Seth Godin. Get creative; if you reach a point in negotiations where you can’t agree, think up a new way to get you what you want and to get them what they want.
- Follow up in Writing: Always follow up a discussion with the points agreed to in writing. Email this to the client and make sure that you both have clarity on what was discussed.
- Never Negotiate Against Yourself: If you gave an offer or a price and the other person didn’t accept it, DO NOT offer them a lower number. This is called negotiating against yourself. Instead, ask them to make you a counter-offer.
- Don’t Fall for the “Hurry up and Sign!” If your new business partner is giving you the rush-rush to sign a contract before you are ready or have time to think about what you are agreeing to, Don’t Do it! Ask them to slow down and to allow you the time you need.
- Don’t Negotiate with Someone Who Doesn’t Make the Decisions: If the person you’re dealing with says “I have to go ask my boss now if he agrees” insist that you deal directly with the person making the negotiating decisions. Don’t fall for this game. It’s a negotiating tactic.
- Don’t Agree to Something That Feels Wrong: Look out for Red Flags. If the deal feels bad, worries you or turns your stomach, don’t agree to it. Period.
- Don’t Regret your Decision Later: Learn to trust your decision making. Once you make a decision on a negotiation, look forward, move ahead, and never look back with regret. Learn from mistakes, but don’t feel regret.
- Don’t fall for the “But it’s great Promotion for you” Line: When negotiating a business deal, the price you are paid should have absolutely nothing to do with how well the product will sell or how many famous people are involved or anything else like that. When a client uses the “But it will be good promotion for you” line , ignore it. Don’t give it any merit or consideration. It’s irrelevant 99% of time.
- Don’t be afraid to walk away if it goes badly: A bad deal is a bad deal. Don’t agree to one.
I hope these tips are helpful. If you have any to add in the comments, please do. You may want to check out an article on this topic that I really liked titled Negotiation Tips for the Beginner by Man Vs. Debt.
PS: You can find more negotiating tips for art licensing deals in my new book, co-written with artist Tara Reed, called How to Understand Art Licensing Contracts. Click the link to find out more about it!