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OWNER'S MANUAL

Negotiating for Wimps

How to ask for what you want -- and get it. Eleven tips for the confrontation-shy.

I admit it. I hate negotiating. (Hate negotiating.)

To me, a negotiation always feels at least a little confrontational, and I'm a confrontation-averse kinda guy.

Unfortunately, negotiating is a fact of business life.

So if you're like me--a negotiating sissy--here are a few ways to make negotiating a little less stressful, a little more fun, and a lot more successful:

1. Make the first bid. People hate to go first if only because going first might mean missing out on an opportunity: "If I quote a price of $5,000," the thinking goes, "and he would have happily paid $7,000, I leave money on the table." In the real world, that rarely happens, because the other person almost always has a reasonable understanding of value.

So set an anchor with your first offer. (The value of an offer is highly influenced by the first relevant number--an anchor--that enters a negotiation. That anchor strongly influences the rest of the negotiation.)

Research shows that when a seller makes the first offer the final price is typically higher than if the buyer made the first offer. Why? The buyer's first offer will always be low. That sets a lower anchor. In negotiations, anchors matter.

If you're buying, be first and start the bidding low. If you're selling, start the bidding high.

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2. Use silence as a tool. Most of us talk a lot when we're nervous, but when we talk a lot, we miss a lot.

If you make an offer and the seller says, "That is way too low," don't respond right away. Sit tight. The seller will start talking in order to fill the silence. Maybe he'll list reasons why your offer is too low. Maybe he'll share why he needs to make a deal so quickly. Most of the time the seller will fill the silence with useful information--information you would never have learned if you were speaking.

Listen and think more than you speak. When you do speak, ask open-ended questions. You can't meet in the middle, much less on your side of the middle, unless you know what other people really need.

Be quiet. They'll tell you.

3. Expect the best. High expectations typically lead to high outcomes. Always go into the negotiation assuming you can get what you want. Always assume you can make a deal on your terms.

You can't receive if you don't ask. Always ask.

4. Never set a range. People love to ask for ballpark figures. Don't provide them; ballpark figures set anchors, too.

For example, don't say, "My guess is the cost will be somewhere between $500 and $1,000." The buyer will naturally want the final cost to be as close to $500 as possible--even if what you are eventually asked to provide should cost well over $1,000.

Never provide an estimate when you don't have enough information. Keep asking questions instead.

5. Concede for a reason. Say a buyer asks you to cut your price. Always get something in return by taking something off the table. Every price reduction or increase in value should involve a trade-off of some kind.

Follow the same logic if you are the buyer. When you make a second offer, always ask for something else in return for that higher price. And if you expect the negotiations to drag on, feel free to ask for things you don't really want so you can concede them later.

6. Never negotiate alone. While you probably do have the final word, being the ultimate decision-maker can leave you feeling cornered.

Always have a reason to step away and get a final okay from another person, even if that other person is just you.

It might feel wimpy to say, "I need to talk this over with a few people first," but better to feel wimpy than to be pressured into a decision you don't want to make.

7. Use time to your advantage. Even though you may hate everything about negotiating, never try to wrap a negotiation up as soon as possible just to be done with it. Haste always results in negotiation waste.

Plus there's another advantage to going slowly. Even though money may never change hands, negotiations are still an investment in time. Most people don't want to lose on their investments. The more time the other side puts in the more they will want to close the deal... and the more likely they will be to make concessions so they can close the deal.

While some people will walk away, most will hang in for much longer than you might think.

8. Ignore bold statements. Never assume everything you hear is true. The bolder the statement the more likely it is to be a negotiating tactic.

Strong statements are either a bullying tactic or a sign of insecurity. (Or, often, both.) If you feel intimidated, walk away. Otherwise, listen closely for what lies under all the bluster and posturing.

9. Give the other person room. You feel defensive when you feel trapped; so does the other party.

Push too hard and take away every option and the other person may have no choice but to walk away. You don't want that, because...

10. Don't try to win. Negotiating isn't a game to be won or lost. The best negotiation leaves both people feeling they received something of value. Don't try to be a ruthless negotiator; you're not built that way.

Instead, always try to...

11. Build a relationship. Never take too much from the table, and never leave too much. As you negotiate, always think about how what you say and do can help establish a long-term business relationship. A long-term relationship not only makes negotiating easier the next time, it also makes your business world a better place.

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Last updated: Feb 2, 2012

JEFF HADEN | Columnist

Jeff Haden learned much of what he knows about business and technology as he worked his way up in the manufacturing industry. Everything else he picks up from ghostwriting books for some of the smartest leaders he knows in business.

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.



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