4 Mistakes to Avoid When Negotiating

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  • 8/13/2019 4 Mistakes to Avoid When Negotiating


    4 Mistakes To Avoid When Negotiating

    Life is one big, ongoing negotiation. Wenegotiateabout whos going to drive, whos goingto pick up or fix dinner, whos picking up the bar tab and what were going to pay for a newcar. Sure, some negotiations are bigger, scarier and have way hairier consequences if wescrew up (ob negotiations, our raise, our emp!oyees raise etc". #ut a!! in a!!, negotiations arefair!y standard.

    $he one sticking point for a!most every businessperson seems to be money. Somehow,putting price on the tab!e freaks us out and ratt!es our cages. %t makes us say and do stupid

    things that negative!y impact the negotiation, but it doesnt have to. $here are four rea!!ysimp!e pricing mistakes that can make or break your negotiation. &ont do these things'

    1. Spraying and praying.$hrowing out a range of prices signifies your status as anegotiating amateur and cou!d potentia!!y upset everyone at the tab!e. or examp!e,responding to a question about price, you say, )$hats going to cost between *+, and*-,. $he prospect hears *+, and you hear *-,. /o one wi!! be happy and you!!spend the next hour or so finding a midd!e ground where you fee! cheated and they fee! takenadvantage of.

    2. Speaking in round numbers.*0, is a round number and that means that it is notspecific. $he c!ient is either going to figure you have no rea! idea what something costs, orthat youre rounding up in anticipation of expecting to be negotiated down. 1ound numbersare )ba!! park numbers. $hat means theyre somewhat arbitrary and the other party can noton!y negotiate it down, but is expected to do so.

    Saying )*00,23- as opposed to )*0+, is very specific. %t sounds !ike youve figuredyour cost, added a percentage, and that youre not going to budge very far from yourestimate. 4our specific number is !ess !ike!y to get negotiation pressure, since the c!ient wi!!assume it is tied to a specific ca!cu!ation.

    3. Being the nie guy.4ou think youre being )fair, or being the )nice guy, so you ask thec!ient what they fee! is a )fair price. Wrong. Whoever speaks numbers first in a negotiationsets the starting point for a!! subsequent negotiations. $he first to speak wins. &ont ask whata fair price is5throw out what youre thinking it is.

    4. Being a motor mouth.4oure nervous, so you do what peop!e do when theyre nervous.$hey ta!k. #ad move on your part. #reaking the si!ence when a number is put on the tab!e isone of the biggest mistakes novice negotiators make. Si!ence is your rea! friend. Si!encecauses extreme pressure.

    When you present your number, put it out there and then S67$ 78. 9ust sit and wait. %f the

    customer doesnt ta!k, dont assume anything and sure!y dont ta!k. :ount sheep in your heador think about what youre going to have for !unch. #ut dont ta!k. &ont panic. &ont worry

  • 8/13/2019 4 Mistakes to Avoid When Negotiating


    about what the other person is thinking. 9ust wait.

    :ustomers need to absorb a number and go through a ustification process in their head. 9ustsit, smi!e and wait, and wait, and wait, if you need to. #e ca!m. &ont rush them and dontfee! rushed. $hink of it !ike a game of )chicken. Whoever panics first and reacts, !oses.

    9ust reading these tips isnt going to turn you into a seasoned negotiator overnight, but theyrestarting points. 8ay attention to your negotiations, but watch how others fare when they makethese same mistakes. ;eep practicing. %f you cant find a business dea!, then find a f!eamarket and start hagg!ing. %ts the best p!ace ever for !earning the fine art of what not to saywhen making a dea! without !osing a bund!e of cash in the process.

    Read more posts about the art of negotiation.

    Mike Michalowicz is CEO ofProvendus Groupa consulting firm that help companies whose

    growth has plateaued to move forward again. Michalowicz is the author of $he 8umpkin

    8!anand$he $oi!et 8aper