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Five Tips for Successful Negotiations: Part II

negotiating contracts

In September, I mentioned that as an attorney I'm always negotiating for my Clients as it's a key part of my job. However, all of us negotiate each day and the team of lawyers at The Doyle Law Group, P.A. have put together five tips. We unveiled the first two tips in Part 1 of Five Tips for Successful Negotiations, and as promised, here are the last three.

Tips for Successful Negotiation

Tip #3: Plan Your First Offer or Counteroffer AND Aim High. I suggest that after you have done your research and know the basic range in which you should negotiate, plan your first offer or counteroffer, and prepare to back it up with facts that justify it.

I always make offers supported by facts that make my offer appear generous when in truth (in most cases) it is beyond the best I could hope for. Most negotiators will tell you it’s best to let the opposition make the first offer if you can, but I do not always feel that way.

It depends on the case.

Setting the Bar High

If I really need to set the bar high and come out hard (such as an injury case against an insurance company), then I need to come out first with a very high demand supported by blown up photographs and detailed calculations and estimates, etc that support my number. I do this to show them immediately that this will NOT be a small case and we will not be low-balled and to show them we are prepared and aggressive.

Don't Get Low-Balled

If I did not handle it this way, then they would come out with their own low-ball offer supported by their written evidence and start the process off low, and I don’t want that.

It puts me on the defensive from the outset.

On the other hand, if you are dealing with an inexperienced opponent, or someone with less subject matter knowledge than you, you may want to let them make the first offer because it may be much higher than you think, and it may make you raise your expectations.

I have had some opponents start out beyond the midpoint of our high and low goals, and accordingly I met with my Client, raised the bar a little, and settled in excess of our expectations. The main point here again is to know what you are going to offer or counter offer and support it with evidence.

DO NOT ALLOW a low-ball first offer or counter-offer knock you off track or discourage you.

Tip #4: Plan and Practice Rejections and Reactions. If you are new to negotiating, you will learn it can be very hard to say no to some people.

Types of Negotiators

There are generally 4 types of negotiators:

  1. the charmer
  2. the bulldog
  3. the master of detail
  4. and the problem solver

Naturally there are others with different combinations, but most people who do it for a living fit into one of these categories.

The Charmer

The charmer is almost impossible to say no to and is sort of high pressure salesman that you cannot help but like.

The charmer needs to be cut-off on the friendship thing. It is usually a sales technique and a form of manipulation, so do not engage in it. Keep it business like and do not let them too far into your world. Make firm but polite refusals and do not engage when he talks about how his family other than required by politeness. If he keeps on, drop the politeness.

The Bulldog

The bulldog tries to scare you into not taking the deal and is adept at bullying, making you feel foolish, and making you question your assumptions.

Dealing with the bulldog, it is essential to be nice, be firm, and match petty move with petty moves until he tires of it. He will.

The Master of Detail

The master of detail spouts of facts, figures, and enough details to fill an encyclopedia. Its only after the negotiation do you realize that 99% of the facts and figures were either half wrong or had nothing to do with the negotiation and it was a ploy to intimidate you and again make you question your expertise which in turn makes you question your bargaining position.

In any case with any type of negotiation, prepare yourself to say no firmly, and shake your head when you do it. Tell them that the offer is just not acceptable and do not leave any room to be pressed. Never say “well I don’t know”, or “I’m just not sure”, as that will invite an attack.

It makes you appear unsure obviously and that you could be berated into taking their deal and giving them more money. Be firm. Take a break and consider your goals and measure their offer within them. Then, plan your counter move.

The master of detail just needs to be allowed to say their piece and spout off. Once they have demonstrated their expertise, only engage in what you wish to. Do not engage in factual debates with these types unless you can match them in mastery of the minutia, and even then you will waste time. After a while, look bored and ask them for their offer. You will make your point.

The Problem Solver

Finally, with a problem solver, you can engage in a negotiation, but try and be make sure they are not bluffing you. You will recognize them right away with “how we can this thing done folks” approach. These types will try and get “win-wins” which are sometimes possible in multi-issue negotiations.

Countering a Bad Offer

If the offer is way off, or is just a touch better than their last offer, then they are negotiating aggressively. In that case, you will either want to go and ahead and walk out (or start to but you must be prepared to go), or prepare a response that is equally as unmoving. This is the best way usually to deal with the tough guy negotiator who acts as though he has you over a barrel. Give it back to them dollar for dollar.

If you are $100,000 apart and he moves in increments of $1000.00, so do you. If the fair number is $75,000.00, then you move in $250.00 increments. Match silly aggression with silly aggression. It’s the only way to deal with those types.

You must also consider where there first offer came in determining a reasonable counter as well. If your first offer was incredibly optimistic while there’s was quite reasonable, then they have a right to move less and should expect to move more. I respect a negotiation that cuts to the chase so to speak. So, in that event, you can move significantly more than they, at least at first and not feel bad about it.

Examples are looking for creative ways to pay money owed that require less of a down payment, exchange money owed for goods or services, or simply listening to why each party cannot do a thing and trying to find a solution respecting those issues. These type negotiators are often most effective in family law disputes and multi-faceted business transactions that involve practical problems to overcome. This is not the correct approach in buying a car or negotiating with an insurance company.

Tip #5: Formalize Your Agreement. Assuming you just negotiated the deal of your life and have gotten that amazing deal or agreement, it is essential to get it writing and bind the parties to it.

For this you may need an attorney if you did not have one already. All the terms must be included in writing and spelled out, and all deadlines, details, and payments along with any conditions. Only an attorney with contract experience can draft a document and ensure its enforceability. If you are dealing with a sales agreement, make sure every part of the deal is included in one place, and do not under any circumstances let “trust me” or “that goes in the financing agreement later” or any other such promise talk into walking out without the whole deal written in one place and properly executed.

Again, on any other deal, you should consult an attorney prior to the negotiation so that you can have the agreement ready and waiting. In any case, the last thing you want to do is waste the great deal you just worked so hard for by waiting and having people back out or bind you in writing only to the parts that hurt you while saving for later your benefits.

Let a Raleigh Divorce Attorney Negotiate Your Case

That wraps up our five tips to a successful negotiation and I hope you found them useful. One thing to remember, is that it's ok to say no! If you need professional expertise in dealing with negotiations, the business law attorneys at The Doyle Law Group, P.A. can help. To get started, just fill out the contact form on our website or call our Raleigh office at 919-301-8843.

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