#1 of 101 Best Practices in Negotiation

I just finished conducting my "Best Practices in Negotiation?" seminar at UC Berkeley, and once more, for seemingly the zillionth time, we found support for far and away the #1 Best Practice in Negotiation:

"Make your first bid low if you're the buyer and high if you're the seller."

Here's the situation. The case we discuss to demonstrate this fact involves the buyer and seller of a mixed-use piece of real estate located in the city of Midville.

The seller has agreed to sit down with the buyer, the owner of an adjoining property, face-to-face without the intercession of Realtors. If they can reach agreement, a hefty sales commission of about $50,000 can be saved, making the deal more cost effective for both parties.

After the mock negotiations are done, a discussion ensues and we track the back-and-forth offers as they were made within each negotiating team. And sure enough, the sellers that opened with high bids achieved more profitable sales, while the buyers that started with the lowest, benefited from achieving the best buys.

While this "truth" may seem obvious to seasoned negotiators, it surprises many novices as well as those that have never received formal negotiation training. They prefer to "cut to the chase," as they frequently put it, and bid something very close to their bottom-line or walk-away position right away.

But that almost always backfires.

When folks negotiate, they need to leave some room in which to operate. Typically, this means planning to stake out at least three positions in one's mind before sessions get underway:

(1) A best-case scenario position, your "dream price";

(2) A target-price scenario, what you'd be reasonably happy to achieve; and

(3) A walk-away price, which is simply out of range, and too costly for you.

Staying in the first two categories is almost always served by remembering to:

"Make your first bid low if you're the buyer and high if you're the seller!"

Are you looking for "best practices" negotiation, sales, telemarketing or customer service training? Contact us.

Dr. Gary S. Goodman is a top trainer, conference and convention speaker, and sales, customer service, and negotiation consultant. A frequent expert commentator on radio and TV, he is also the best-selling author of 12 books, more than 1,000 articles and several popular audio and video programs. His seminars are sponsored internationally and he is a faculty member at more than 40 universities, including UC Berkeley and UCLA. Gary brings over two decades of sales, management and consulting experience to the table, with impressive academic credentials: A Ph.D. from USC, an MBA from the Peter F. Drucker School of Management, and a J.D. degree from Loyola Law School, his clients include several Fortune 1000 companies..

His web site is: http://www.customersatisfaction.com and he can be seen on CNBC at: http://www.cnbc.com/id/15840232?video=417455932# and reached at: gary@customersatisfaction.com. His blogs include: YOUR CUSTOMER SERVICE SUCKS! and ALWAYS COLD CALL! at: http://www.alwayscoldcall.blogspot.com

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