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Common Negotiating Mistakes Cheat Sheet by

Common Negotiating Mistakes
common     mistakes     contract     negotiations

Introd­uction

Skill in the art of negoti­ating can make your life easier and more profit­able. Failing to develop a knack in this important part of doing business can silently eat away at the foundation of your success.

Whether you are negoti­ating with prospects, customers, vendors, distri­butors, suppliers, your landlord or even employees, it is critically important to put yourself in charge. Avoiding these 11 negoti­ating mistakes will help to give you the upper hand:
Credit: William J. Lynott is a veteran freelance writer specia­lizing in business manage­ment, personal and business finance.
http:/­/ww­w.b­lyn­ott.com.
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1. Not building relati­onships

There may be times when you have to enter into negoti­ations without any unders­tanding of the other side’s positions. But wherever possible try to establish a relati­onship with the other party in advance; doing so will greatly increase your negoti­ating power. Even seemingly unimpo­rtant “small talk” can help to establish trust while giving you some insight into how to deal with the other person. Not knowing anything about your opponent in a negoti­ating situation is a major handicap.

2. Talking too much

In negoti­ating, silence carries a great deal of power. Most people are uncomf­ortable with silence and negoti­ating pros are well aware of that. Train yourself to get comfor­table with the awkwar­dness of silence and use it to your negoti­ating advantage. After a period of silence, the first person to speak will usually be at a disadv­antage. As one pro puts it, “He who talks the least learns the most.”

3. Not listening

It is often easier for us to think about what we want to say next rather than listen to what is being said. If that sounds familiar, you have a valuable opport­unity to bolster your negoti­ating success. “Listening is a skill that you must work on” says Michele Tillis Lederman, author and adjunct professor at NYU’s Stern School of Business. “Listening is not a passive activity. It takes energy and concen­tration to focus on what people are saying and what they mean by it.”

4. Failing to understand difference between ...

Failing to understand the difference between arguing and negoti­ati­ng: In an argument, each person makes a strong and sometimes irreve­rsible point for or against something. Under those condit­ions, seldom if ever is any productive conclusion reached. In contrast, the purpose of a negoti­ation session is for both sides to reach an agreement. Almost without exception compro­mises on the part of both sides are necessary. Negoti­ation skills on your part can help to avoid that deal-k­illing conclu­sion.

5. Waiting for other party to make the first offer

Contrary to conven­tional wisdom, there is no research supporting the claim that waiting for the other party to make the first move is advant­ageous; in fact, making the first offer can serve as an anchor influe­ncing the other party’s counte­roffer. If you do decide to make the first move, avoid making an unreal­istic offer — such a move can backfire by discou­raging the other party from continuing in the negoti­ation. But remember that first offers are hardly ever accepted so make sure that your offer allows room for maneuv­ering
 

6. Not knowing your BATNA:

Skillful negoti­ation calls for careful advance consid­eration of possible outcomes — that’s why it is best to know in advance what the least is that you will agree to. BATNA stands for “Best Altern­ative to a Negotiated Agreem­ent.” The term originated in the book “Getting to Yes: Negoti­ating Agreement Without Giving In” by Roger Fisher and William Ury. Even though your aim in negoti­ation is to come away with what you want, it’s important to decide in advance what your next-best altern­ative is (your BATNA).

7. Failing to control your emotions

Keep your emotions in check and you are less likely to enter into a bad deal. By mainta­ining the option to call it a day you’ll be in a stronger bargaining position if the other party decides to try again. In that case, the pressure will be on them to improve the offer.

8. Forgetting that everything is negotiable

Don’t allow yourself to be sidetr­acked by statements declaring that something is non-ne­got­iable. Once you decide that the terms for anything are subject to change, you give yourself a strong negoti­ating advantage by offering a sensible, viable and mutually beneficial altern­ative.

9. Failing to prepare

Even though you have a clear idea of what you want to accomplish in a negoti­ation, you still have to think about and prepare your arguments carefully. You also want to learn as much as possible about the other party — whether it is an employee, your landlord, a supplier or a potential big client. No matter how major or minor, the more knowledge you can demons­trate about the subject of the negoti­ation, the more respect you will get from the other party and the more confident you will feel. Also, good prepar­ation makes it less likely that you will forget something, as it is extremely difficult to introduce new demands after negoti­ations have begun.

10. Failing to Ask

Key to successful negoti­ations is asking for what you want. The fear of rejection or of appearing greedy can put a major dent in your negoti­ation success. Rejections are going to happen; however, it is important to remember that they are not personal. When you get a “no” remember to keep asking. Always have several altern­atives to offer, and remember why you have your BATNA.

11. Issuing an ultimatum

The one deadly mistake inexpe­rienced negoti­ators make, is beginning the negoti­ations with “this is our best and last offer.” Once that’s said, there’s no room for negoti­ation. The other party has been put in a defensive position. While it may become necessary to become aggres­sive, it is always best to keep in mind that the ultimate goal of a negoti­ating session is to reach a mutually acceptable conclu­sion. Should a deadlock be reached, one solution could be setting a deadline for the conclusion of the negoti­ations. This gives both parties time to reexamine their positions and reopen talks with a renewed effort to reach an agreement.

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