We all spend most of our day negotiating, whether we realize it or not.
From the moment my hit feet the floor in the morning, I'm negotiating: with my three kids, to get dressed and eat their breakfast without making a mess. With my husband, as we juggle the morning circus of household tasks to get everyone out the door.
When we get to work, most of us continue negotiating, even if it's not an explicit part of our job description. We manage multiple projects, and negotiate with colleagues and supervisors about which one should be the highest priority. We negotiate pricing and contract terms for our products or services with our clients or customers. We ask for the resources, staff or even vacation days we need, negotiating with other people or departments to get what we need.
What if you don't feel comfortable negotiating, or worry you're not very good at it?
Negotiation at its core is simply a discussion with another person to reach an agreement, usually involving a compromise. And you can get better at negotiating by practicing.
I've spent the last 13 years negotiating with other lawyers, clients, and even judges about everything from multimillion-dollar lawsuits to scheduling a meeting (the meeting schedules often require much more finesse than the lawsuits!).
Here are top tips from me, and a few from other local business owners, for making better deals through negotiating:
1. Do your homework: Know your bottom line, and your "why." You must know your absolute bottom line number or other terms that are necessary to reach an agreement, and why they're important, before you get started. These facts will anchor your discussions and help you know when it's time to stop the negotiations because the other side's offer does not meet your needs.
You should also do some research and be prepared to explain how you reached the number or terms you're requesting, and how they can even benefit the other person. What's the industry standard? Why do you deserve more or different terms? How are you or your product different? Negotiation often involves at least a little persuasion, and having facts and figures at your fingertips goes a long way in these discussions.
2. Ask the other side what they really want, why and how. It seems so simple, but we often forget that the person on the other side of the negotiating table may want things that we haven't thought about, are happy to give, and that may not even cost us anything. Be curious. Asking "why" will help you understand what's really driving their position. By asking questions, before offering anything, you can often be more creative and reach an agreement that's seen as a win for all.
Jenny Hill, partner with Chattanooga web design and digital strategy company Papercut Interactive, suggests going a step further: "Ask 'how' questions. Rather than providing the other party with the answer I expect they'll have, I try to reverse the situation and offer them the chance to 'solve' the problem. So, for example, if a client is requesting a project with an aggressive timeline, I might ask, 'How do we handle the approvals with this schedule?' " Doing this helps the client realize their suggestion may not be workable for their own team. "This puts my client in the driver's seat and gets us both where we want to go," Hill says.
3. Ask for more than you need. Negotiations often involve some give and take, so I always start by asking for more than my bottom line. I was shocked when I started working with female business owners that this was a foreign concept. Starting high isn't always financial; sometimes I'll ask for other terms that would be nice to have, like a longer or shorter time period or more control over some part of the deal, but which I'm willing to let go in order to compromise, so long as I'm still meeting my bottom line requirements.
It's critical to remember that you can't know the other person's bottom line or required terms at the beginning of a negotiation; what you consider "high" may be well below their maximum number, so there's a big potential for upside from this tactic.
I'm not suggesting you make a totally unreasonable request or lie about facts or circumstances (this can actually backfire and result in your losing credibility), but it's a good idea to start a little high so you have room to compromise.
4. Think collaboration, not confrontation. Remember the other side wants to reach an agreement, too.
In my own law practice working with creative business owners, I often encounter women who don't negotiate because they think the other side is offering a take-it-or-leave it deal, and they worry they will lose the deal if they ask for anything.
I've found that it helps my clients to think of negotiation as collaborative, not confrontational. Both sides have something of value that the other wants, and may be flexible on the exact terms of the deal. The goal of negotiation should be to bring the two sides together in a happy agreement, where everyone feels good about the outcome.
Chattanooga Realtor Beth Harrell says that her main job on any given day is to be a strong negotiator for her client. She recommends keeping the end in mind and not getting mired down in details that don't matter during extended negotiations. "In a real estate transaction, from price point through inspection issues, no one will get everything they want. All will give something, but everyone's goal is to close the deal."
Negotiation doesn't have to be scary or intimidating. When you know how to ask for what you need, you stand a much better chance of actually getting it.