An asymmetrical trade is a trade where the cost to the giver is low or zero while the perceived value to the receiver is very high. So as part of your Information to Find search, always look for special asymmetrical trades, things that are very low cost or no cost to you but are very important to the other party.
Imagine that you are considering buying a small company with approximately 25 employees. The current owner is insisting that you agree to a covenant not to terminate any of those employees for at least 12 months after purchase. This is no problem at all for you since you are buying the company as much for the employees as for their products and revenue.
You could simply say:
• “That’s no problem. I was planning to keep all of your employees anyway.”
Or you could say:
Well, I’m sure you can understand that it is imperative that we retain the necessary flexibility to manage the business. On the other hand, we understand your concern for your loyal employees. A one-year covenant is certainly something that we can consider depending on how the rest of our discussions proceed.
In the first response, you are conceding that point because it really doesn’t cost you anything. This would be OK if you recognize its potential as an asymmetrical trade and decided for whatever reason not to use it that way. However, you shouldn’t simply agree for the sole reason that it was what you planned to do anyway.
In the second response, you are using it as an asymmetrical trade. Here you are leaving it on the table as something to keep in mind that you will trade for later. Alternatively, you could have tried to trade for something else that you wanted.
Asymmetrical trades can be enormously effective in closing a sales negotiation. Let me tell you a story that a fellow named Tom told to me. Tom was a salesperson for a company that sold truck leases. One of his long-time customers was a small mom and pop meat packing outfit in the Bronx, in New York City.
Tom told me that they were a good, long-term customer, who every year or so would lease a truck from him. Then, at one point, they decided to expand and add a second shift at their plant. The good news was that they needed to lease five additional trucks. The bad news was that for the very first time, they had gone out and looked at the deals available from one or two of Tom’s competitors.
And, unfortunately for Tom, what they discovered was that the interest rate for the leases being offered by his competitor was fully 2½ percentage points below what Tom was offering. In other words, if Tom’s price for the money was 10 percent, his competitors were offering it at 7½ percent.
So they called Tom in and said:
• “Tom, you know that these prices you are quoting simply aren’t even close to being competitive. If you want this business you are going to have to come way down.”
Tom talked about all his added values, but in typical buyer fashion they said:
• “Yeah, yeah, yeah, so does the other guy—talk to us about price.”
So Tom, nervous about losing the business and not having anticipated a negotiation here, dropped his price a point and a half. But he was still one percentage point above his competitors. And so the meat packers told him:
• “Listen Tom, we’re very loyal customers and we like you a lot. We’re so loyal that if you come down another percentage point to meet your competitor’s price you can keep the business.”
To which Tom replied:
• “There’s nothing more I can do, but I tell you what. Let me go talk to my manager.”
And they said:
• “Fine, go talk to your manager.”
But Tom didn’t need to talk to his manager right away because he knew he had reached his company’s Least Acceptable Settlement (LAS). He knew he would not be allowed to go any lower. What he had done, though, was to use authority limits in order to get a delay.
What he actually did was walk down to the local bar to have a drink with the key technical decision makers for that company when it came to trucks, who were, that’s right, the drivers. Tom, being a smart sales person, had gotten to know the drivers at all of his small- and mid-size customers, as an important source of information.
So he walked in and said:
• “Hi guys, how are you, how are things going?”
• “Oh, things are fine, you know we’re expanding, we’ll have more drivers, things are pretty good, except for that community problem we’re having.”
So Tom gently probed a little as he bought everybody a round of drinks:
• “Oh what community problem?”
• “Oh, you know, that noise issue.”
And as he probed a little more, he discovered some very interesting information. When the meat packers expanded to a second shift, they needed more storage space for the uncut meat product. In fact, they had totally run out of storage space for the finished product. So what they were doing, since they didn’t want to expand the size of their plant, was to load the finished product onto their trucks, and the trucks would take it off to market. That worked just fine for the day shift, but for the evening shift, well the markets weren’t open again until 4:00 a.m.
So what were they doing? They were using the trucks as storage space. And of course, since this was meat, it had to be kept cold, which was no problem for them since all their trucks were refrigeration units. But that meant that they had to run the trucks all night in order to keep the meat at the proper temperature.
Since this was in New York City, and their plant was right in the middle of a residential neighborhood, and there were apartment buildings all around them, the noise was driving their neighbors crazy. It was turning into a major community dispute.
The next morning, in his boss’s office, Tom says:
• “Hey, boss, remember that crazy deal that we got involved in, where we ended up with that little piece of property over in the Industrial Park?”
• “Yes.”
• “And it’s paved and fenced right?”
• “Yes.”
• “And we’re keeping that as an investment, right? We don’t have any current plans for it?”
• “Yes.”
• “Well, it’s only a few blocks away from the meat packers, but there aren’t any apartment buildings within earshot of it. Could we let them park their trucks overnight there?”
• “Sure, as long as Corporate approves it.”
The word came back from Corporate, as long as the meat packers maintain and insure the site, they could park their trucks there. Tom told me:
Do you think Tom’s solution to their problem would have been worth even more than the 1 percent premium that he achieved? Tom did. He said to me:
Dogone, I wish I had gone and talked to the drivers before I made any concessions! Because with the solution we came up with for our customer, they probably would’ve paid the full 2½ percent difference between my original price and that of my competitors.
I agree with Tom, they probably would have, but at least he made the sale.
So as part of your Information to Find search, always look for special asymmetrical trades, things that are very low cost or no cost to you but are very important to the customer.