Negotiation

So who is Mark Harrison?

● 37 years old● Studied Maths / Computing at Oxford, formed my first

company in my finals year. [It failed, BTW]● Joined the workforce in 1992, discovering IT paid

better Climbed the greasy pole for a few years, retired in 2003 (because I’d bought a bunch of investment properties)

● Got bored…. Now do three things (sometimes at the same time)– Interim Director– Run a training / mentoring business – Non-exec Director

We're all at it

vs.

vs.

Tim is (even now) WAY betterat tennis than me

Three Components

● Principles what● Psychology why● Ploys how

Principles

Principles

● You spend all this time worrying about what your customers want BUT…

What the hell is it you want?– Please DON’T tell me it’s a sale– Cashflow?– Growth (because you want to be bought)– A one-off purchase vs. a long-term relationship

● Think carefully, your customer might want something different

● The longer time they invest in negotiating, the more motivated they are to agree a deal

● BATNA (Best Alternative To Negotiated Agreement)

● Work out who the “economic buyer” is– If there are several, find them ALL– If your business is B2C, see later about WOMEN

IT’S NOTABOUT PRICE

People buy from people / brands

Buyers value other things

- (Speed / Security / Service)

- eg FSC Certification

Before you go into the negotiation

● What's the MOST you can pay– Or least you can settle for, if you're selling

– Auctions vs. leveraging Proprioception

Close the (conceptual) sale before you start

talking about price

Sell what customers want, eh?

Psychology

Beliefs

● Empowering● Disempowering

It’s a law?

● They need you?

Never say yes (or offer the asking price first)

● What happens if you do?● Is the seller

– Happy– Unhappy

Ploys

Ploys = Strategy + Tactics

● The strategy– Frame the negotiation– Get the seller to invest time– Never give away too much in one go– How much authority?

Opening Tactics

Frame the negotiation

Offer low / Ask high(Kingfisher compensation)

Tactic The Opening Response

● Flinch● For phone, gasp

● Just a bit of fun, or is it?

Time TacticAsk the wife

● For those without a wife...– Husband– Boyfriend– Girlfriend– Partner

● Take your time

Women buyers● Women buy… (US figures)

– 94% of home furnishing– 92% of holidays– 91% of new homes– 89% of new bank accounts– 80% of DIY purchases– 60% of cars– 51% of consumer electronics

[Source: www.tompeters.com]● Relationship● Networking

– This is not “wishy washy stuff”

Go away… then, when you come back...

● Only come up by a small amount– I was selling…

● My asking price, £179,950● They offered £170,000

Splitting the Difference

● Whoever offers to, loses● Encourage the vendor to make the offer

THEN

We aren't going to drop this over a few thousand / hundred are we?

Good cop, bad cop

● The vendor is bad cop● The estate agent is good cop

There is no good cop

OK – it’s a property example, but use what you learn across ALL your businesses

www.yourpropertyexpert.com