Our last blog post on TGT was focused on the steps to negotiation. Today we cover the last piece on negotiations…the techniques to master negotiations. We will share four of the most effective techniques that were shared by Mr. Maldonado.
• Make Friends
o When negotiating with another party, building friendly connections is the most effective technique of all techniques. Establishing a cordial relationship can increase future business relations. In other words, the negotiating party may want to conduct further business in the future due to the established relationship and trust between you and them. All in all this creates a win/win situation for both parties as the need for negotiations may be eliminated as a whole.
• Conditional contract
o This is the second favorable technique. This technique allows both parties to reach a win/win situation. During tough negotiations, where both parties want to reach an agreement it can help to use a conditional contract. In this scenario both parties agree to conduct business together if certain requirements are met. Otherwise, the deal is not valid. This allows room for flexibility in a deal, where the most important requirements are emphasized.
• Good Cop/Bad Cop
o This is techniques number three. If you are using this technique to your favor you as a negotiator must be vague about the higher authority. For example “I am going to run this by my partners or the board”, this is vague enough. As a negotiator you wouldn’t want to reveal the identity of the higher authority; Hint: the higher authority is the bad cop, while you are the good cop.
o On the other hand, if the opposing negotiating party is using this technique against you, the best approach one can use is to call it out. Bring the negotiating situation to light and request to have a meeting with both “cops”. When you have everyone in the room, it creates a fair environment where everyone gets to voice out their terms and conditions, the requirements and achieve the best deal possible for both parties. Therefore, if all things go well you’ve diffused their tactic successfully.
o Using deficits to your advantage: If you are conducting business with a negotiator who is looking to gain a win at your expense then you can plant deficits. While planting deficits, essentially you would be pointing out imperfections in the product in order to reduce the value and/or price of the product. Such a technique can produce a win/win situation for both parties, where a reasonable deal is obtained.
o Averting the deficit technique, if used against you: On the other hand, if someone uses this technique on you, it is your best bet to be prepared. Do the research and gain a clear understanding of the competitive alternatives that exist in the market. Then, prepared your sales pitch and focus emphasizing the ways in which your product or your business differentiates from the rest of the market. Showcasing your product or business as unique can create an increase in demand.
Now…we have reached the end of our blog on the subject of negotiation. Congratulations! You mastered the art of negotiation!