So much of doing business involves bargaining that it’s a shame so few people have a natural aptitude for it. Still, there’s hope for the rest of us, especially if we learn from those who have mastered the art of negotiation. In 7 Secrets of Great Entrepreneurial Masters, business coach Allen Fishman offers these techniques he has learned from decades of working with top entrepreneurs — and applied in his own negotiations:
1. Provide information to build trust
Tell your negotiating partner something meaningful he didn’t already know. When Fishman’s team conducted due diligence on one potential acquisition, it uncovered serious problems unknown to the current owner. Fishman revealed the problems to the owner and urged him to fix them even if the deal fell through. The owner’s suspicion dissipated and they got down to serious talks.
2. Find the final decision-maker
Your first meeting might be with a subordinate who was sent to handle the early stages of bargaining yet acts as if she has the full power to negotiate a deal. If you ask her directly whether she has the authority to finalize the transaction in all respects, you’ll likely get an honest answer, but she might not volunteer this fact. If you assume she’s the final decision-maker, you might make all your concessions to her and have no ammunition left to offer the person with the power.
3. Keep it impersonal
Focus on the action you wish to achieve, not on whether you like your negotiating partner. Although he may have needs that conflict with yours, treat him as a person playing a role, not an enemy.
4. Use questions to pry open undisclosed information
If you ask a series of fact-gathering questions about the potential agreement, you might uncover a deal changer or breaker. Often you’ll learn something your opponent wasn’t hiding but simply hadn’t thought about. Fishman once asked the owner of a real-estate property he wanted to buy whether the owner had any tax needs the deal’s structure could help address. The potential seller had never thought of this possibility, so hadn’t brought it up. But once Fishman heard the owner’s tax concerns, he called a top tax attorney who found a way to address them. That paved the way to a deal.
5. React to body language
Many people reveal non-verbally that they’re not as adamant about a negotiating point as they claim. When Fishman was negotiating a strategic alliance, he understood that his opponent’s pursed lips meant that even though she was apparently rejecting a term he saw as essential to the deal she didn’t in fact have her heart set on turning down the alliance. Without registering any emotion, he reworded the question slightly to change a minor factor in his proposed terms. She agreed without hesitation.
6. Laugh off intimidation tactics
In one negotiation Fishman witnessed, a six-foot-three man who towered nine inches over his negotiating partner moved in nearly nose-to-nose to put himself in the power position. But the shorter man didn’t get rattled or angry. Instead, he smiled sweetly and said, “Jim, you’re invading my space. If you want to get anywhere with our discussion, you’ll have to back off.”
7. Be the one with superior “butt power”
Many negotiations are won because the losing side lacks the patience to sit in endless meetings. Your own sense of urgency to conclude a deal can be your worst enemy, and an opponent who senses this might try to pressure you into a hasty deal by setting an arbitrary deadline. Ask yourself whether there’s a logical reason for the deadline to exist. Some of the best deals are made long after a “final” deadline has expired.