Negotiation in daily life and business is a competitive game. In order to win, you need to have the right actions and strategies. If you don't, you could end up losing deals, customers, and profits. Use the powerful and sneaky tricks outlined below to make more lucrative deals for your business and enjoy more success overall.
1. The Flinch
Don't fall into the trap of accepting the first offer that the other side throws at you. Whether it is a price, a term sheet, or a time limit, always "flinch" when they express it. This means that you physically and verbally react with shock and surprise to indicate that you would never go along with such a ridiculous proposal. For example, if you are negotiating the price of widgets with a factory, and they tell you that they can sell them to you at $1.00 per unit, you would physically flinch and say: "One dollar?! Oh, no, that's much too high." Regardless of whether you are pleased with the initial offering, flinching can usually get you a better deal.
2. Reduce to the ridiculous
When you are the one proposing a price, be sure to frame it in a positive way. This means that you want the price to seem as low as possible. If you are selling real estate, you wouldn't tell the buyer that the furniture costs only an additional $5,000. You would instead "reduce to the ridiculous" by talking about the cost in the smallest context possible. For example: "The furniture will cost you only $0.25 per day over the life of your mortgage." This makes a larger cost for the other side seem much more manageable (and thus you can profit more if they agree to it).
3. Last minute
Never reveal your deadlines to the other side during a negotiation, but always press them against theirs. People are more flexible when time pressure is applied. Think about it -- if you have all year to negotiate the lease of your retail shop with your landlord, but your landlord has only two weeks, you have leverage because you're not in a hurry. Use time to your advantage as often as possible.
4. Higher authority
Always indicate that you need to check on final decisions with a higher authority. This can be a spouse, a supervisor, or even your board of directors/advisers. This lets you buy time and think a decision over before agreeing to anything during negotiations. It also lets you save face with your negotiating opponent by not directly shooting down their offer.
To make your negotiations as profitable as possible, it takes the right knowledge. If you act on this knowledge, you can put yourself and your company into a position of power. Make sure to use all of the tricks above as part of your negotiating arsenal to quickly master the art of negotiation.