When chess players expert goes against one another, they don’t only improvise their moves on the chessboard. They go to the game ready with an arsenal of gambits. These are calculated moves that entail some kind of risk; however, can offer a player a key edge if they’re deployed in an accurate manner, at the right time.
Also, power negotiators possess gambits. They can be broken down into three groups, which relate to the three stages of negotiation: the beginning, middle, and end. Beginning gambits are the moves you start with which you can utilize to acquire a strong position at the beginning of a negotiation. Then middle gambits assist you to progress the negotiation in the way you need it to go. Lastly, the ending gambits allow you to close the deal in your favor.
In this book chapter, you’ll understand how to utilize these three kinds of gambit. Taking you from the start of a successful negotiation to the end; also, this summary will teach you some of the keys principles and ideas of power negotiating.
Chapter 1 – In order to create a desirable negotiating range, request for more than you hope to get.
Let’s say you want to purchase a new car. The salesperson’s asked for a sum of $18,000, and your aim is to make him reduce it to $15,000 – a difference of $3,000. In order to begin the negotiation, you need to put in an initial bid. What do you have to do?
The answer is one of the key beginning gambits of power negotiating: you need to request for a better deal than you expect to get. Doing this can make you prevent one of the most frequent errors novice negotiators make: giving up a lot of ground very early.
If you start the bid with a sum of $15,000 for the car, you’re eventually going to give away most of that $3,000 difference between the price you offered and the salesperson’s price before the negotiation has even actually started. Nevertheless, except it’s his first time on the job, he’s going to react negatively against whatever figure you offer – and even if things go smooth, you’ll maybe end up at a place halfway between your respective initial points.
The space between those two points creates your negotiating range – the distance between which you and the salesperson will attempt to get to a compromise. The lower your first bid, the more the range. If you make your first deal really low, the range will be really wide that your target price will be right in the middle. Therefore, if you together with your counterpart meet each other halfway, you’ll get just what you need!
This is known as bracketing: making a first deal that changes your target price to the midpoint of the negotiating range.
To go back to our case in point, if the salesperson is requesting for a price of $18,000 and your target price is $15,000, you’d bracket your target price by making the first deal of $12,000 – $3,000 lesser than your target price, just like how the asking price is $3,000 higher.
If you’re on the opposite part of the negotiating table, you’d use the exact principles, just in the opposite. For instance, let’s assume that you’re a widget salesperson. Your prospective buyer says he will pay you $1.50 per widget. You’re expecting $1.75. What’s your first counteroffer? That’s correct: $2.00 – bracketing your target price by adding $0.25 of negotiating space on any side of it.
Chapter 2 – Negotiating gambits possess a wide range of uses.
Requesting for a better bid than you hope to get is essential to negotiating a favorable result in a sales transaction –however, the purpose of the gambit is more than that.
Aside from making use of the gambit in negotiating any kind of deals that has to do with money, like an increase, you can also make use of it for other, nonmonetary parts of a deal. For example, if you’re purchasing a piece of real estate, you might ask for an unrealistically huge number of revisions to the paperwork, under the hope that just a part of them will be acknowledged by the seller.
Also, gambit functions outside the field of business altogether. Say, for instance, you’re a diplomat that is part of political negotiation between two governments, you could begin with very greater requests than you anticipate the other side to cede.
The same thing can be said about the other gambits we’re going to look at. But, for the purpose of ease, let’s mainly concentrate on sales transactions because they entail more direct circumstances with easy-to-understand numbers that don’t require lots of contextualization. In order to make things even easier; also, we are going to concentrate on only one aspect of these negotiations at a time: that of the buyer or the seller. However, have in mind that the exact notions apply to both sides of the negotiation; they only have to be twisted to suit the buyer or seller’s part.
For instance, look at another beginning gambit: playing the hesitant seller. In order to do this, you need to pretend that you’re much less keen to sell your goods or service than you really are. Let’s say you’re selling a property, you could tell your prospective buyer that you’re not certain you want to sell it since it has huge sentimental value to you. This is a method to limit the negotiating range in your favor. The more you sway the buyer of your unwillingness to sell, the less likely they’ll be to lowball you in their first bid, especially as they won’t want to make you more reluctant to sell.
However, two people can play this game; also, your counterpart can behave like an unwilling buyer. They only have to sway you that they’re not really interested in buying your property. For example, saying that there are a lot of well-priced choices they’re looking at is one method. It might entice you to reduce your asking price, narrowing the negotiating range in their favor.
Chapter 3 – Cautiously selected body language and verbal language can have a huge effect during negotiation.
As you’ve possibly assumed, power negotiating entails a reasonable amount of trick. You don’t actually anticipate to purchase that $10,000 second-hand boat for $5,000; you’re only using that bid as a mean of broadening your negotiating range and bracketing your target price of $7,500. Furthermore, the owner isn’t really hesitant to sell his boat; he’s only pretending just so you could make a better bid.
The same thing is correct of another beginning gambit: flinching. To carry on with the same illustration, when the owner of the boat offers his first sale price of $10,000, you need to behave obviously surprised that he would bid such a type number – even if it’s totally sensible! If you’re a better performer (and the owner is a bad enough negotiator), he might react by instantly reducing his asking price. Even if you don’t get that lucky, you’re still communicating that the price is unacceptable to you in a way that’s much more convincing than words alone.
On the other hand, if you don’t react or have an intuitive reaction to his bid, the owner might read your neutral body language as the price doesn’t look really high to you, even if you state otherwise. This might make him view your words and counteroffer as only a bluff, which will make him abide closer to his asking price.
Yes, body language is essential when negotiating –however, words can be really powerful as well. This following gambit entails making use of a simple seven-word phrase. It’s known as the vise method. In order to use it, let your counterpart decide her first offer. In reaction, and with a quiet voice, you then say, “You’ll need to do more than that.” The next decision is hers.
The key of this gambit is to take the negotiating ball right back in her court; therefore, let it remain there until she does something with the ball. If she’s a beginner negotiator, she might reply with a better offer – refining your negotiating range even before you’ve made a counteroffer.
However, if she’s an expert negotiator, she’ll return the ball back to you by questioning, “How much better do I need to do, precisely?” Now you need to make a decision with a price that will create the negotiating range.
Bear this countermeasure in mind if someone attempts to use the vise method on you!
Chapter 4 – Even though it’s a great offer, never take the other side’s initial offer.
We’re now going to explore the last beginning gambit –however, it’s definitely not the least essential. Certainly, it signifies one of the key rules of power negotiating: never take the other side’s first offer.
Say you’re purchasing or selling something and the other person is the first person to offer a deal, the reasoning here is clear: you could have a better price by having a counteroffer and negotiating more. However, what if you’re the person getting the first counteroffer? And what if it looks like a great offer? Your feeling might be to jump on it.
Don’t do that.
In order to understand the reason why you shouldn’t, let’s say you’re purchasing a second-hand car from an acquaintance. You ask the person for the cost. He says it costs $5,000. You wish to pay $4,000; therefore you counter by proposing $3,000. Afterward, without a second of reluctance, the man then says, “Okay, sold! It belongs to you now!”
On paper, this seems like a reason to jubilate. You only reduced your target by $1,000 without even needing to actually negotiate! But, in reality, though, your mind’s alarm bells would be ringing, since if the man was that fast to sell you his car for closely half his asking price, maybe something is wrong with it.
Also, you’d walk out of the negotiation being frustrated with yourself for not trying your luck even more. If it was really easy to make him cut it to $3,000, what would have been the case if you’d proposed an even lower price–maybe, $2,000? Maybe you could have received a better bid. You’ll never know now.
By contrast, let’s say that the man declines your first offer and then pushed you into a long, hard-struggled negotiation where you eventually got to your target of $4,000. You’d be giving $1,000 more than in the other case; however, you’d most likely feel more content with the result. By not changing the price without a struggle, the man would make the car look more valuable, and he’d leave you with a feeling like you couldn’t have made a better deal out of him.
In perfect negotiation, both parties end the negotiation feeling like they won. However, the other side can’t feel like they’ve won if you don’t go for a fight. Having that in mind, you need to reject the initial bit all the time – not only for your own sake but for the sake of the other party too.
Chapter 5 – Keep using the method of bracketing and decrease your concessions during the middle stage of negotiating.
We have gotten to the middle stage of negotiation. At this moment, you’ll have made used of your beginning gambits to create a negotiating range that’s suitable for you. It is now time for you and your counterpart to begin moving closer to each other, to attempt to meet on a deal.
If it’s an amount you’re attempting to decide on in a sales transaction, the buyer will try to make the seller reduce, and the seller will try to make the buyer increase. One party has made the first bid already, the other party has made the first counteroffer, and now both of you begin to make more counteroffers here and there.
While doing this, you should keep on using the bracketing method. For instance, imagine you’ve proposed to purchase a house for $140,000, and the owner has proposed to sell it for $200,000. Your bracketed target price is $170,000. Now let’s assumes he reduces it by $10,000. To keep the bracket, you need to just increase it with a similar $10,000 max. If he reduces it by another $5,000, you need to only increase by not more than $5,000. By doing this, your target price remains in the midpoint of your negotiating range, while the range becomes narrower.
This takes us to an essential warning: ensure that the concessions are not the same, and ensure that the last concession you make isn’t a huge one. You need the concessions to reduce it into smaller and smaller increments.
To go back to the former illustration, you shouldn’t bargain three concessions of $10,000 in a row. That would take you up from your initial offer of $140,000 to your target price of $170,000. Now, if you needed to abide by your target price, you’d have to crash on the brakes and say to the seller, “Sorry, I can’t go higher than this.” However, this isn’t going to look convincing to the other party. Nevertheless, from his viewpoint, you’ve just approved a total of $10,000 three times in a row. Certainly, if you’re contented to give up such a huge amount, you’d be eager to come down a few more thousand dollars?
In contrast, if you accept $10,000, then $5,000 and then $1,000, you’ll make a much stronger sense that you’re attaining your limit.
Chapter 6 – Insist on a trade-off all the time.
As we’ve understood, the middle stage of negotiation is essentially about making wise concessions. You’re forfeiting ground to the other side; however, you’re being alert not to give up a lot really fast. Also, you’re claiming that they forfeit an equal, if not bigger, the sum of ground in response.
This takes us to one of the clues to success in the middle-stage of negotiation: the trade-off gambit. It goes down to a rule: do not make a concession without requesting for one in return. For instance, say you’re selling a house, and the buyer questions you if she can take some furniture into the garage before taking ownership of the property. At the moment, even though there is nothing in the garage and you don’t care about it, you don’t need to give away this concession without asking a trade-off.
What should you request for in return? Make it open-ended. Instead of suggesting something yourself, allow the other party to suggest something for you. Just ask them, “If I can give you what you want from me, what will you give me in return?” By doing this, you’re leaving the ball in her court. And who knows? Perhaps she’ll answer by offering something really greater than you were anticipating!
This takes us to the first cause why you should ask for a trade-off all the time. When the other side requests for a concession, it’s a natural chance to get something in return. Why give that up? Even if the concession doesn’t harm you, you could still gain from allowing it.
However, even if that only looks greedy to you, there’s another cause to do it: if you decide a concession without requesting for something in return, you’re creating a dangerous pattern. The other side will now reason that they can request for sacrifices from you without needing to make any sacrifices themselves. If they’ve nothing to lose, why shouldn’t they request for one further thing – and then another, and then another? Meaning, by not requesting a concession, you’re inspiring the other person to be greedy!
By making use of the trade-off gambit, you can solve this issue. If you create a pattern that whenever the other party request for a concession, you’ll request for a concession in return, they’ll be very sensible and restrained with their needs.
Chapter 7 – In order to prevent getting concessions and set yourself as more of an ally than an enemy, summon a higher authority.
Let’s say you’re a salesperson for a midsize paper company, and you’re making a deal with a customer. In the middle of the negotiation, she requests that you make an important concession: adding expedited delivery to her huge order of paper supplies. Understanding about the trade-off gambit, you question her what she can offer you in return. However, then comes her emotionless, hard reply: “nothing.”
It looks like you’ve gotten to a dead end. What do you do?
Now would be a great time to higher another middle gambit: the higher authority. This involves acting that there’s another person or entity who has to agree on any concession or choice you make. For instance, you could say to your customer something like this: “Well, I’m not certain if I can persuade my people to accept this offer without an extra charge for expedited delivery.”
Even though the client doesn’t harm, at least you’ve given yourself some time since she’ll need to wait on for you to “speak to your people.” If you come back after and tell her, “Sorry, my people say they can’t offer you free expedited shipping,” you’ve also taken part of the stings out of the rejection. Nevertheless, you are not the one doing the rejecting; it’s your “people.” You’re only the messenger.
Mention the vagueness of the authority you’re summoning: your “people.” Depending on the circumstance, you could also act that you need to defer to “corporate,” “the committee” or your “family.” The vaguer it is, the better. If you mention a person (let’s say, your boss or spouse), the customer might ask if she can speak one on one with the authority. You’re inviting her to take away the middle person which is you.
On the other hand, if you make the authority vague, you’re revealing yourself as an essential go-between. As a matter of fact, more than only a messenger, you can even depict yourself as the customer’s friend in relation to the authority. For instance, you could say, “I tried very hard to persuade my people to offer us the free expedited shipping; however, they just wouldn’t move. What can we offer them in return? I want to look for a mean to make this work.”
Observe how you’re now depicting the authority as a hindrance that you, the salesperson, are attempting to assist the client to avoid. By doing this, you’re evading the free concession and creating goodwill simultaneously!
Chapter 8 – If a negotiation gets hindered, be ready to bring in a third party or even withdraw.
Let’s assume you’re in the middle of a sales negotiation, and you’ve chosen the entire stops. You’ve flinched, bracketed, summoned a higher authority – you mention it; you’ve attempted it; however, nothing seems to work. Your customer is still persistent in having free expedited shipping for her order of office paper. Now it looks like the negotiation has really gotten to a dead end. How do you solve this?
If you’re actually stuck, one choice is to call on a third party to offer a fresh view and suggest a new solution. This person could be a neutral third party, such as a professional mediator or arbitrator. However, that person could also be someone who can serve as the role of intermediary – even if he’s basically on your side. For instance, as a salesperson, you might bring in the manager.
As an extra bonus, that kind of intermediary’s words might have more weight for the other party than yours. Maybe the reason why your customer is insisting on free shipping is that she just doesn’t trust you when you say it’s not possible. Perhaps she believes you’re only attempting to raise your commission. Therefore, if your manager says “no” that might seem really more resounding.
However, what if the other party actually refuses to change her decision? Also, what if it’s about something that’s really unacceptable to you? The answer to this is one of the most key secrets of power negotiating: be ready to withdraw from the bid, and pitch your capacity and readiness to do so.
One easy method to do this is to make it obvious that you have other choices. For instance, you could say that you have other potential customers you could sell the exact good to; you don’t have to make this specific deal with this particular customer.
Projecting walk-away power is one of the key methods to boost your hand as a negotiator. If the other party notices that you have it, and if she truly wishes to make a deal, she’ll be hesitant to push you really far and lose the bid over a mere concession. But, if she notices that you’re reluctant to walk away, she’ll be very persuaded to refuse to compromise and take a risk. Nevertheless, if it looks like you want to make the deal, then it’s sensible for her to believe that you’ll ultimately yield. Don’t allow it get to that point.
Chapter 9 – When a problem becomes a sticking point, put it aside for later on.
It is not a shameful thing calling in an arbitrator or leaving a stalled-out negotiation. If it has to occur, it has to occur. However, before you take one of these more extreme actions, there are a few less extreme methods you should attempt.
The first method is to shake things up. There are a lot of methods to do this, depending on the matter. You could change the situation of the negotiation by proposing that you carry on with the discussion over dinner. You could ease the mood by discussing what you like doing or some interesting industry gossip. You could bring in new energy by changing the members of your negotiating team. Anything you do, the key is basically to thaw the ice and make the flame of the negotiation alive.
Another method is to make use of a set-aside gambit. The notion behind this gambit is that when you get to a dead-end in a negotiation, it’s generally about only one or a few of the numerous problems you’re attempting to fix with the other side. For instance, if you’re attempting to sell a custom-built product, the sticking point could be the time-frame for making the ideal. The customer is insisting on only a month. And you understand that it is not possible; therefore, you are attempting to persuade him that you need extra time, however, he just won’t listen to you.
There are still various other problems on which you can possibly get to an agreement, though, ranging from the conditions of the product to the means of payment. Having that in mind, you should put aside the problem that’s the sticking point and concentrate on the other ones where you can reach an agreement. Nevertheless, you can continuously go back to the sticking point during the last stage of the negotiation.
That might seem like postponing a decision; however, it serves a really strategic aim. Having dealt with a lot of other problems and getting really close to the end line, the other party will most likely be hesitant to lose the bid over mere measly information. He probably won’t want to withdraw from a fight empty-handed and feel like his time and energy were futile.
Include the additional sense of drive and the goodwill he’ll hopefully be feeling at this point of the negotiation, and he’ll most likely be much more receptive to reaching a compromise.
Chapter 10 – At the end of a negotiation, it’s so simple to get a little concession from the other party.
The more we put in our time and energy in business, the less we want it to become a waste. The more we reason something as being our own, the less we want to forfeit it. Also, the more we feel ourselves getting close to the end line, the less we want to fall in the last stage.
In the end stage of negotiation, the set-aside gambit maximizes these psychological weaknesses –making use of them to pressure the other party into offering a concession they might not otherwise make. This is the exact thing for the following gambit we’re going to explore nibbling.
In order to do this, you basically wait until the last instants of the negotiation, and afterward, immediately when it looks like you’ve attained a deal, you request for one final small concession or two. For instance, if you’re purchasing a truck that has been used and you’re close to signing the check for $7,000, you could nonchalantly say that “Oh, and that truck is coming with a full tank of gas, right?”
At this moment in the negotiation, the other party will feel like that $7,000 is basically hers, and that she’s done a lot of work into achieving it. The deal only needs a signature for it to be finalized. Due to that, she most likely won’t want to risk it over just a little concession; therefore, she’ll just accept it to prevent any issue.
Definitely, the other party can also attempt to make use of this gambit against you. If you’re selling a product, one method to safeguard yourself against it is to write out the prices of further benefits and display it to the potential before time. By doing that, you’ll prevent them from attempting to request those benefits free of charge at the last stage of the negotiation. Another way is to make use of higher authority gambit. For example, you could state that your manager hasn’t approved you to accept the bid that’s being nibbled for.
Lastly, you can attempt to make the other party feel a bit embarrassed about their effort to nibble. In order to avoid this counter-gambit from stinging very hard, wear a big smile on your face and, in a good-natured voice, you could say something like, “Oh, come on. You’ve already received a good deal out of me!“ Hopefully, this will intimidate them into forfeiting the demand.
Chapter 11 – If the other party of negotiation becomes a bit too greedy, you can react by withdrawing an offer.
Similar to nibbling, the following end-stage gambit we’re going explore at also uses the advantage of the fact that people don’t like losing things they’ve already assume as their own. It’s a risky however strong method to bring the end stage of negotiation to a close when the other party is being stubborn and attempting to try their luck really far.
If you see yourself that kind of situation, you can attempt to withdraw a deal. in order to know how it functions, let’s assume you’re a salesperson in the end stage of negotiation over an order of widgets. Your first bid was $2.00 per widget; the buyer’s first counteroffer was $1.50. After lots of hither and thither, you reduce it to $1.75, and it looks like the buyer is willing to accept this price. However, then he becomes a bit greedy. He realizes that, after all, if you were ready to reduce by $0.25, certainly he can get one more cent out of you. Hence, he begins insisting on $1.74.
Now it’s time for you to withdraw your deal. This consists of a two-step move. Firstly, say to the other party that you’re going to take his demand to your higher authority in order to see if they’ll accept it. Afterward, return to him and give the bad news: not only has the demand been rejected; however, it really turns out that your bid was really generous and has to be withdrawn too.
To reduce the blow of this gambit and protect yourself from the other side’s rage, ensure that you behave apologetic, hide behind a higher authority and give a reasonable excuse. For instance, you could say to the person that wants to buy the widget that, “I’m really sorry – this is so embarrassing. However, you know that amount of $1.75 I was proposing yesterday? Well, a person in accounting entered the numbers, and it turns out that we made a mistake. Due to a current increase in the cost of raw materials, the lowest price we can give you is really $1.80.”
A few minutes ago, the other party was really taking the $1.75 price for granted that he felt confident asking for a lesser offer. Now it’s been removed from under his feet. Surprised from this unexpected loss, he’ll most likely reply by attempting to get back the former price – effectively not remembering about his request for $1.74 in the process. Problem fixed.
Chapter 12 – When you’ve done a great work of negotiating, sugarcoat the offer to enable it an easier pill for the other party to swallow.
From requesting for more than you expect to get to withdrawing a bid under made-up acts, there’s a fair share of trickery entangled in a lot of the negotiating gambits we’ve been looking at. If this has put a bitter taste in your mouth, you’re lucky: the final gambit we’re going to explore enables you to finish a negotiation on a sweeter note.
Let’s begin with the common scenario in which you’d use it. Let’s say you’ve been utilizing each of the gambits you’ve learned in this book, and you’ve been performing well in your negotiation –as a matter of fact, you’ve been doing a bit too well. You’ve made the other side to make a lot of concessions that he’s feeling very exhausted at this moment. He’s nearly ready to make an agreement with you; however, there’s one final thing hindering it: his pride. He basically doesn’t want to accept a win and requires a means to save face.
This is where this final gambit comes to help. It’s known as positioning for easy acceptance. In order to do this, you just add a nice small extra freebie – with no conditions. Say you’re selling a car, you could give out your snow chains. Or you’re selling equipment; you could say you want to supervise the installation personally. Say, you’re selling a good with a warranty, you could increase the warranty from two years to three.
The freebie can be really little– the notion is basically to be the last person to provide a concession. That way, the other party can approve of the bid while feeling like they won the last win. This will ease the blow of the former defeats and enable them to feel good about approving the bid.
Definitely, the whole win is still yours –however, keep that fact to yourself. Don’t celebrate or tell the other party he could have had a better deal out of you if he’d negotiated more. He’ll use it against you if you ever negotiate with him again – and even if you don’t negotiate with him again, why ruin the goodwill you’ve just established?
As a matter of fact, do the opposite: behave as if he got a better deal and commend him on a job well done. Keep in mind that, a win-win negotiation is whereby both parties leave feeling like they won; therefore, allow the other party basks in the glow of that feeling.
Secrets of Power Negotiating: Inside Secrets from a Master Negotiator by Roger Dawson Book Review
By using an extensive range of strategic moves called gambits, you can extremely increase your balances of success in a negotiation. In the beginning stage, you can create a favorable negotiating range by requesting more than you expect, flinching, making use of the vise method and acting to be a hesitant buyer or seller. In the middle stage, you get closer to the result you want by reducing your concessions, invoking a higher authority, and by utilizing the trade-off and set-aside gambits. Last, at the final stage, you can seal the bid by nibbling or withdrawing a deal.
Keep in mind that money is money.
When negotiating bids that have to do with huge amounts of money, it’s normal for people to fall victim to reasoning in terms of percentages instead of absolute numbers. For instance, let’s assume that you’re about to purchase a house for $200,000, and you could get the other party to reduce it to $199,000. The savings of $1,000 is only one half of one percent; therefore, it doesn’t look like a huge deal if you view it that way, and it’s simple to let go of. However, what if you used only a minute persuading the other party to reduce by $1,000? In and of itself, that’s huge money for a really small amount of time. Assume that you had a job that paid you $1,000 every minute!