There are two golden rules in negotiating a deal.
1. Be prepared to accept the worst; and
2. Know who you are negotiating with.
Be prepared to accept the worst
When you negotiate hard you need to accept your best offer may be rejected. Can you live with that? Can you carry the attitude: well if I don't seal the deal, is there another deal around the corner?
If you can't, you'll find your negotiations become weak. But if you can ... That’s a different story. You won't be intimidated. You will be strong. You will put your offer on the table with a take it or leave it attitude and transfer the doubt to the other side. They will think ... This person seems so sure ... Can we hope to get a better offer elsewhere?
If you’re buying a property do your due diligence, satisfy yourself it meets your specifications and go in with an offer to buy it on the spot - no conditions about engineers' reports or availability of finance. Offer an absolutely unconditional offer.
The price is below the market value, and below offers other potential purchasers have made (usually with conditions), but as a sweetener have a cheque to seal the deal right there and then.
That cheque must be for an amount two or three times higher than the amount they would normally expect for a deposit.
No bickering, no protracted negotiations, and real money on the table. It usually works because we've all been conditioned by the old adage – “a bird in the hand is worth two in the bush”.
So whether you are negotiating over a piece of real estate, or you're in a job interview, or you're going for a loan from a bank, or bidding for a contract – do not be intimidated by the fear of not pulling it off. This way you will be able to put your case more strongly, more passionately and with more determination.
Know who you are negotiating with
Does the person on the other side of the table have the full authority to make a decision or are they just an intermediary.
If you deal with the person who has the power to sign you have the power to walk away because there is no strategy to pull you into future negotiations with a fresh adversary.
If you deal with the decision maker your key points will not be lost in the translation, you are less likely to have disputes or confusion about the interpretation of a particular provision and you will create a relationship which may be beneficial down the track.
You negotiate because you believe it is to your advantage to do so, but this will only be so if you have a better or alternative option.
When you have a best alternative the other side does not have the power in the negotiation. It's as simple as that.
And if the situation is reversed, you must follow golden rules: be prepared to accept the worst and go into the negotiation passion, determination and without fear.
Your attitude and confidence are so important in a negotiation. They are crucial. They are everything. They’ll make you a winner.