In an earlier blog post, “The Psychology of the Negotiation,” I focused on four strategies. Since I find this part of my business so fascinating, I wanted to share a few more techniques that can be very effective.
Power of competition
BATNA is an acronym for “best alternative to a negotiated agreement.” Before beginning a negotiation, it’s critical to know the best option available if an agreement can’t be reached. The other party has to know that I don’t have to do this deal. It must be established that if favourable terms can’t be achieved, I’ll simply move on to the next option. The better the BATNA, the more power I have.
Power of risk-taking
Going into a negotiation, I must be willing to lose and to be comfortable with walking away. I have to demonstrate emotional intelligence and never take a risk out of pride or impatience. This is critical to the personality of a professional negotiator.
Power of investment
Knowledge is power. As a commercial real estate broker, before entering a negotiation, I need comprehensive market statistics, comparable lease and/or sale data, and up-to-date knowledge of the current competition. I also need to know as much as possible about the asset I’m negotiating on. Factors such as location, environmental condition, deferred maintenance and property amenities — to name a few — can all impact the value.
Power of precedent
We’ve all heard and said: “That’s the way it’s always done in this market. I’ve never seen it done differently.”
Most people will believe their experience is the only one there is and, if they haven’t seen it done, it hasn’t been done.
The reality is that just because it may be common practice in one geographical area, it doesn’t mean it can’t be changed. People are naturally creatures of habit and typically resist change.
There are many more powerful negotiating techniques that I’ll share with you at another time. Do you have a favourite?