Negotiations are a tricky subject. Everyone is trying to get theirs, and there are likely going to be disagreements. It’s easy to get caught up defending your position and trying to win.
It’s not about winning, though, at least not at the expense of the other party. Instead of trying to take something that you want, wouldn’t it be easier if they just gave it to you?
The sooner you stop focusing solely on what you want, the more potential the negotiation will have.
Instead of only considering what you’ve got at stake, consider the other side.
The key to a successful negotiation, one that is based more on skill than luck or personality, is figuring out what the other party wants. Money? Value? Terms? These are all leverage points and it pays to discover them.
When you know what they hope to gain, you can use it to your advantage. You can use it to make a better case that they may be more likely to agree with.
Let’s say you’re buying a house and the seller has a certain price in mind, but that’s not what it’s worth to you or what you’re willing to pay. They’re likely not going to budge unless you have your facts straight. You need to show hard evidence about the actual value of the property. You need to be straightforward about what needs to be fixed or how healthy the market is.
If the seller is looking for $500,000, which includes a make-ready repair cost of $50,000, then you can haggle. You can say, “What if you don’t make the repairs? Are you willing to come down on the price?” A lot of sellers try to price their property as high as possible to balance out the necessary repairs, but by realizing this, you can offer them a way out.
You’re taking the pressure they’re putting on themselves away; they may be more inclined to take $450,000 for the property instead of dealing with repairs and recouping their losses.
It’s all about choices, really.
Create More Choices
You don’t want to get into a single-issue debate that derails the whole negotiation.
To further a leverage negotiation, you need to decide all the issues you’d like to win when making your opening offer. Everything from pool inspection and termite treatment to appraisal fees and closing costs.
You might not get them all, what then?
If I get the majority of them. I say to the seller/buyer, I would like to get more info about the last issue. Maybe it’s price again. Instead of giving up your position or being stubborn against theirs, you can create another option.
Not only is a compromise more likely to be agreed on, but this takes the risk out of the transaction AND gives you an out. It’s a compromise and a contingency plan for you.
Don’t cut off your nose to spite your face. The entire deal isn’t worth losing over one issue.
Focus on taking the leverage positions, checking off as much as you can, then isolate the remaining positions while adding information to them to create more leverage.
There’s plenty more to negotiating, but this should help you find more room for successful agreements.
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