Improve your skills with insights from this collection of short articles with real-world negotiation examples. Below you will find examples of various negotiation topics, including preparation, concessions, leverage, value, tactics, intimidation and more.
And for a much more thorough discussion of negotiation tactics, download our complimentary whitepaper “Negotiation Games: Spotting and Neutralizing Five Tactics that can Damage Deals”.
Unprincipled concessions are concessions not tied to a credible business rationale. Years of research show us that this simple business negotiation mistake costs companies between 9 and 18% of their gross operating revenue.
Not all books on negotiation skills cover how to handle internal dissension or conflict during important negotiations. There’s a reason we included it as the third of K&R’s Six Principles™ of Negotiation: A team divided is a costly team.
Here is an example of how one of our seasoned negotiation consultants, “Hank,” handled a very difficult situation with a member of his own team before joining us at K&R.
Hank’s client had put together a strong team to negotiate a deal with an Israeli company. This was one of his client’s biggest deals ever in the country; huge commissions were riding on it. Read more
We once assisted a Japanese client company (we can call them “Friendly”) in negotiating a strategic alliance with an American company (whom we will call “Abrasive”) that had a reputation for being challenging. Prior to our meeting, we contacted a colleague who had done business with Abrasive. Our friend warned us that the lead negotiator would be very confrontational.
Understanding that our clients at Friendly were inclined to maintain harmony, we discussed the potential problem with them beforehand. We asked them to let us handle any adversarial moments.
Not long after negotiations began, the lead negotiator for Adversarial announced, “We are going to use our contract, and if you don’t like it, you can leave!” Read more
I often ask people, “Who are the best negotiators in the world?” The most common answer is, “Children.” Yet, children have never been trained in negotiations (certainly not by us). What makes them such naturally effective negotiators?
There are a number of answers to that question. For example, children use tactics of emotional blackmail (screaming in a public place) or they will “negotiate” with principled concessions (“I will eat the peas if you let me stay up until 10.”). The answer we hear most often is that children are naturally persistent – they just don’t take “no” for an answer. Their wants are simple (“I want a cookie.”), yet they have the willingness to repeat the request as often as needed to get their desired outcome. Any parent can tell you about a repetitive argument they’ve had with their child – the child, being persistent and having absolutely no sense of time pressure, simply repeats the same argument over and over again until the parent loses patience and gives in. Read more
Knowing how people are measured for bonuses, rankings, commissions or promotions helps you determine the personal motivations that can be just as important as company position when it comes to closing the deal.
Simply making someone’s job easier can be a major motivation. Here’s a software negotiation story from the K&R files:
It was the middle of the fourth quarter and the software sales team of Company X was trying to sell a $650K software monitoring solution to a major financial institution, Company Y. The customer IT executive had been convinced a few months earlier that the solution would help them tackle certain technical issues in serving their international accounts. The Company X sales team was getting pretty frustrated with a sale that should have been easy. They couldn’t get Company Y’s procurement team to move with urgency. Read more
Often, successful sales negotiations rest on preparation. How do you go from hard work to successful outcomes? What’s the actual process? It’s preparation.
Preparation means always gathering information to gain an understanding of the motivations and objectives of the other side as well as our own. Without this understanding, we’re merely guessing at the terms (the requirements) that might satisfy the other side. How can you solve the other side’s problems if you don’t know what they are?
Good preparation also gives you confidence. Read more
All negotiators should build a value case for the positions they would like the other side to accept.
As a buyer, you would like the seller to understand the value of doing business with you because, for example, you are a flagship account and a reliable customer who pays on time.
As a seller, if you don’t build a value case for the product or service you’re selling, the buyer may not see that value. Even if they see the value, they may see it very differently than you do or they may not acknowledge it, since acknowledgement of value gives you leverage.
In addition, failing to articulate value may affect your credibility. The buyer may feel you are not listening to what matters to them – and, as a result, you lose credibility. Alternatively, in acknowledging the value impact to a customer, you gain credibility by showing them you understand what they consider important.
Articulation of value requires you to know something about the other side. The more you know, the better – especially in a negotiation. Knowledge is power. You have to know the gaps the customer has to fill – and then fill them. When you use value properly, you’re usually successful. Read more
This is the seventh post in a series entitled: The Principles of International Negotiation: Finding Universal Value in a Complex World
It’s a worldwide phenomenon: You’re on vacation in a foreign country and decide to buy a souvenir. You know you shouldn’t pay the price they’re asking, so you make a lower offer on that “locally produced” carving. The vendor takes it. As your purchase is being wrapped, you’re thinking, “That was too easy. I could have bought it for less.”
We’re not trying to teach you to deprive starving artists of their living. But whenever someone asks for and easily gets a concession, Read more
This is the sixth post in a series entitled: The Principles of International Negotiation: Finding Universal Value in a Complex World
As many have learned, cracking the united front of a negotiation team can yield prized concessions. As with a teenager who knows how to play one parent against another to get permissions and privileges, the party across the negotiation table will pick your team apart if given a chance. Even if it’s an opportunity they don’t take, disunity can severely damage your credibility, and prolong or sometimes cripple negotiations. In an international environment, where team members can often be in different time zones, keeping a unified voice is a particular challenge.
In a key negotiation meeting with a Japanese buyer, our team firmly held that the product we were selling had to be clearly differentiated by the Japanese before it was resold. Read more
“Face” is a person’s standing in the eyes of others. In negotiations, that means looking good to each negotiation side, peers, management, spouse and family. It avoids putting someone in an awkward position that could humiliate or embarrass them, particular with a direct confrontation. When confronted negatively, negotiations can quickly deteriorate. However, giving someone “face” makes them feel good and helps form good business relationships.
At K&R Negotiations, we have extensive experience in business negotiations. We’ve collected numerous negotiation skills examples from a wide variety of business negotiations. Here’s an illustration of saving face from our collection of negotiation examples.
We were representing a buyer of equipment from a Chinese company. We were buying, not selling. Harvey was in the second seat, sitting across from the most senior negotiation on the opposing team. We’ll call him “Lu Jiang”. He was serving as a mentor for a much younger team member, Chang Lee, who was the lead negotiator for the Chinese team. As the mentor, Lu Jiang had a lot of face riding on this negotiation. Read more
