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Negotiation Techniques That Work

Updated on June 15, 2017
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Digital marketing professional with B2C and B2B experience in strategic marketing, lead generation, content marketing, SEO, SEM, and CRM.

It's a deal

Do your research to get the best deal.
Do your research to get the best deal. | Source

Are you being manipulated?

It looks like this child is about to get his way.
It looks like this child is about to get his way. | Source

Do Children Negotiate or Manipulate?

We learn as children that there are some things that can be negotiated, or perhaps manipulated. Children quickly learn their parent's individual weaknesses (tired, distracted, mad at spouse), and will work those emotions to get what they want in that moment. When children become teenagers, their negotiation tactics improve because the stakes are higher. Borrowing the car on a Friday night may require that a set of chores be completed before receiving the keys from mom or dad.

As adults, we negotiate to get a higher salary, better benefits, a lower price, a better service, or a longer term. There are also non-financial stakes when negotiating such as married couples agreeing over who will do the laundry, clean the kitchen or mow the yard. Having good negotiation abilities and understanding the process works in all types of relationships. Successful negotiation skills in business can give you an advantage when negotiating contracts and terms. The same principles of negotiation can be used to get the best price on products and services in your local marketplace.

Reasons People Will Not Negotiate

Emotions and ego certainly become part of a negotiation. This is especially true when you are working with a seasoned salesperson. They know how to quickly and effectively manipulate your emotions. They can assess your knowledge and use it against you. If they know you love the available upgrades, they will work that tactic. If they know that you are purchasing based on payments, not price, they can add thousands of dollars to your purchase because of flexible terms.

This is why it is so important to do your research before you buy. You should have product knowledge and also be familiar with available upgrades, and warranties. If you are not prepared, you run the risk of someone taking advantage of you.

Poll Question

Would you purchase a car without knowing the value or history?

See results

10 Tips for Successful Negotiating


1. There is no such thing as Win-Win:

  • The very process of negotiating means that one or both parties is willing to give up something in order to get what they want, and that is a Lose-Lose situation.

2. Don't be afraid to ask, and don't be afraid of the word 'no':

  • I worked with a sales consultant that frequently used the line, "Don't ask, don't get." That statement will always be true. We can make assumptions that we can't get a better deal, but it is impossible to know if you don't ask. Even if the other party gives you a 'No' response, it doesn't mean there isn't room to negotiate.
  • If you are negotiating with someone that you have dealt with in the past, and they offered a specific discount, ask for the same or better offer this time. They are already in the position to give this to you based on your prior transaction.

3. Don't negotiate with yourself:

  • Negotiations can break down, and you may feel like you aren't getting what you want. You internalize the things that you can live without. Don't do that. Go into the deal with a set expectation, and don't negotiate down from that point.

4. Pressure-to-buy timelines:

  • If you are test driving cars to find one that meets your needs, you don't have to buy from that dealership. You can visit as many dealerships as you want, but you are not required to buy any car, at any time. A salesman may offer you a great deal, but it usually has a short time frame. This is his 'first offer', and he can probably negotiate from there to give you more of what you want.
  • Go home and sleep on it. Very rarely does anyone absolutely have to buy a car right away.

5. Decisions with timelines:

  • If you have received an offer for employment, make sure that you read it carefully. Some job offers expire at the end of the day. Be prepared to respond according to that deadline.
  • If you are in the market to buy a house, get pre-approved from the bank. Carry that approval letter with you to every showing. Depending on the housing market, you may decide to make an offer during the showing. The pre-approval letter from the bank will put you ahead of non-cash offers that do not have bank approval.

6. Sales commission pressure:

  • You don't pay the salesperson's salary. They earn a commission based on sales. Don't let them sucker you with guilt. They may say, 'You know, if I discount this anymore then I'll lose my commission.' That is false, and they are using emotion to lower your guard. If they say it more than once, then tell them that you want to deal directly with the Sales Director. That will probably lead to them groveling for your business.
  • Don't flinch or show emotion. If a person is trying to sell you something that you want, but don't necessarily need, such as a sun roof, or heated/cooled seats, ask them to show you a different vehicle. The benefits of those upgrades are nice, but may not be in your price range. Tell them that you don't need it, and are not interested. Shut down all discussion about other upgrades. You have a set 'total price', and extras are not part of the deal.

7. Never negotiate payments:

  • Know the top-line that you are willing to spend, and hold to that. Negotiating payments with a salesperson can cause you to spend more than you planned because the terms can be stretched out over time.

8. Know the value of the offer:

  • This is relevant to product, services, job offers and warranties. If you don't know your value to employers, then do some research on salary.com to ensure that you have the best information for salary negotiation. If you don't know the true value of a new or used vehicle, then do some research on Edmunds to ensure that you don't overpay based on mileage or age.

9. Negotiate one thing at a time:

  • If you are negotiating the price of a car, then stay firm on price.
  • If you are negotiating the interest rate, stand firm.
  • If you have a trade-in, don't negotiate until all other terms (price, interest rate, upgrades, terms) have been met.

10. Know your credit score:

  • Knowing the value of your credit score can save you thousands of dollars when purchasing a home or vehicle. It is well worth the time to shop around for the best loan.
  • You can view your credit report once a year for free at AnnualCreditReport.com
  • The higher your credit score is, the lower the cost of borrowing money from a bank or credit union. A high score indicates that you pay your bills on time, you don't exceed your credit limit.
  • A low credit score has the opposite effect. The score indicates that you are a credit risk, and don't pay your bills on time. This includes basic utilities and rent, not just credit cards. A low credit score will cost you in the form of higher interest rates.

Poll Question

If you get 95% of what you want in the deal, is it good enough?

See results

Walk away if the deal isn't right for you

Better to walk away from a bad deal, than to live with one.
Better to walk away from a bad deal, than to live with one. | Source

Be Willing to Walk Away

Negotiating can be stressful. However, if you know exactly how much you want to pay for something, and hold fast to that number, you will know when it is time to walk away. Don't fall in love with something (house, car, upgrades) because that will weaken your ability to negotiate. It is important to be present. In other words, allow the other person to talk. Listen to what they are saying, instead of mentally preparing your response. If you get distracted, you can lose ground. Stay focused on what is being said.

If you understand body language, it will be easier to understand what decisions the other person is making. The use of silence can be a powerful tool to use in any type of negotiation. If you arrive at a point where negotiations come to a stand-still, simply stop talking. Silence during a conversation can be uncomfortable for the other person, and they may present a more compelling offer. If there is no change to the offer, thank the person for their time, and walk out. If you are dealing with a salesperson, they will likely call you with a revised offer within 24 hours. If that doesn't happen, then they do not have the authority to negotiate to meet your requirements.

Know what you are willing to give up before you begin negotiating. If you are buying a new car and really want reclining leather seats with heat and cooling options, keep that as one of your final points of negotiation. However, if the dealer cannot meet your terms, be prepared to accept fabric seats. If you are in the process of building or renovating your home, iron railings can add a classic touch. If the builder is not willing to discount the price, or provide an alternative, then end the negotiation. There will be many other upgrades to negotiate so don't get hung up on iron railings.

Terms and Conditions

Read the terms and conditions.
Read the terms and conditions. | Source

Ink on Paper

Don't sign anything until you have reviewed the terms, understand the value and you are absolutely certain that you have negotiated the best possible deal.

Employer-Based Counter Offers

There is one particular area where negotiating should be avoided. If you are currently employed, and have received an offer from another company then you should notify your boss and submit your written resignation.

Your boss may ask about the offer you have received and want to give you a counter offer. Your employer might want you to stay, so they may offer you an increase in pay, give you more vacation days or other benefits. However, the level of trust has been forever broken. There is a reason you interviewed with another company, so the best advice is for you to be gracious about the counter offer, but end your employment and move on.

© 2017 Michelle Orelup

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    • Mel Carriere profile image

      Mel Carriere 5 months ago from San Diego California

      Learning how to swim with the sharks is never fun, but we have to get our feet wet sooner or later. Great tips.

    • Haider Mama profile image

      Haider 5 months ago from Melbourne

      The only thing I need to learn when negotiating is to say NO. I literally find saying NO very difficult. I feel embarrassed when I say NO straight away.

    • lifelovemystery profile image
      Author

      Michelle Orelup 5 months ago from Houston, TX

      Thanks so much ericdierker. I appreciate your thoughtful comments.

    • Ericdierker profile image

      Eric Dierker 5 months ago from Spring Valley, CA. U.S.A.

      Well done Michelle. Negotiating and working through a certain complex problem are tough areas. With all this stretching of the notion that we are all equal at everything it blocks people from learning because they think that these are genetic gifts. We are generally not born negotiators. This is a thoughtful helpful piece - thank you.

    • lifelovemystery profile image
      Author

      Michelle Orelup 5 months ago from Houston, TX

      Thank you bubiinnovation. I sure do wish I had some of your knowledge of mechanics. If there's one thing I've never been able to negotiate, it's the cost of car repairs. The shop gives me an estimate, and either I accept it, or I don't. But it's the one place I never truly feel like I have an advantage.

    • lifelovemystery profile image
      Author

      Michelle Orelup 5 months ago from Houston, TX

      Thank you AliciaC.

    • bubiinnovation profile image

      bubiinnovation 5 months ago from Vancouver British Columbia

      nice article! good read!

    • AliciaC profile image

      Linda Crampton 5 months ago from British Columbia, Canada

      There are some very useful suggestions in this article, including some that I've never thought of before. Thank you for sharing them.

    • lifelovemystery profile image
      Author

      Michelle Orelup 5 months ago from Houston, TX

      Thank you MsDora. It is really amazing how many things we negotiate and the tactics that can be used in different situations.

    • MsDora profile image

      Dora Isaac Weithers 5 months ago from The Caribbean

      So many pieces of good advise. Number 3 and 9 get may attention. Negotiating with self is so easy to do, especially when you're tired or impatient. I've seen many times when people switch back and forth and forget the priority deal they want. Thanks for these helpful reminders.