Principles for Implementing Golden Rule No. 5
Deploy Preclosure Techniques
In particular, this involves conditional commitment questions: “If we reach an agreement on this issue, can I count on your final agreement today?” Such techniques allow you
- to ensure that there will be no other points of disagreement to negotiate over,
- to ensure that you are dealing with someone who is able to make a decision (unless this crucial issue has been confirmed in advance),
- to “seal” the deal.
In practice, your counterpart is placed in a tricky situation in which, if she answers no or maybe to the question posed, she loses almost any chance of achieving a satisfactory outcome; if she answers yes, she is obliged to agree to a deal.
So how do you deploy these preclosure techniques? A word of advice: Proceed in two stages.
- Start with a “detection question.” This is the “magic” question: “Apart from that one issue, are we in full agreement about everything else?” This question puts the other party in a tricky position. If he answers no, you can drive him into a corner, refusing to make the slightest concession until such time as the picture is clearer: “What are the other issues that you want to look at?”
A skilled negotiator generally tries to dodge the question, for example, by claiming, “If we are not agreed on this issue, it is not even worth pursuing these discussions.” He thereby obliges the other party to give ground without giving anything in return, only to then add insult to injury by demanding a few more concessions that are less costly. Believing he has done the important bit, the first party may make the mistake of continuing to give ground out of fear that the contract will be jeopardized “over nothing.” Naturally, from the outset, you should refuse to back down on one issue while others remain unclear.
Lastly, if your counterpart responds in the affirmative, stating that he is “in agreement on everything else” and that it is only this final issue (generally the price) that is causing the problem, it is in the seller’s interest to press home the advantage: “So, to sum up, let’s make sure that we are agreed on the following points…”
It is true that such reformulation can cause jitters. Will the other party take advantage of this to raise other points of disagreement? Will this cause the agreement to break down at the last minute? You need to be specific, avoiding any gray areas that the other party will use to his advantage, sooner or later. Furthermore, if your counterpart is keen on getting his way on the final issue under negotiation, he will studiously avoid raising extra demands that you might use in order to rebuff him on the key issue. So you need to have the boldness to confirm and to clarify.
- Then pose the “commitment question.” This question allows you to seal the deal: “So, if we can reach an agreement on that final issue, can I count on you making a commitment right now?”
The net is tightening on the buyer: He now has just two potential responses. He can claim that he needs time or can remain vague about his intentions, which amounts to the same thing. You must then ask why.
If your counterpart needs to consult other people, you know full well, and have known for a long time, who those people are. If you have no access to these people, at least you can get a “commitment” from the buyer: “If you were the only one making the decision, what would you do?” If the response is favorable, you should have no hesitation in helping him convince his colleagues or his line management.
If he needs “time to think,” a good response would be, “Me, too. I need to have further discussions with my line management, so I won’t be able to give you my final offer for a few days.”
Your counterpart may be prepared to agree to the deal, at which point it will be difficult for him to retreat from that commitment. You then need to negotiate compensation and make the final concession that allows you to clinch the deal.
With Your Counterpart, List the Various Points at Issue
The number of issues subject to negotiation may range from one (the price) to several dozen, not to mention more complex negotiations such as the sale of nuclear power stations or takeovers of companies or entire groups. In all circumstances, it is desirable to define the scope of the negotiations so as to limit them and avoid the other party continually extending his list of demands, as well as to allow you to gain an overview of the areas of agreement and disagreement. Thus it becomes possible to propose overall solutions “en bloc” or, if necessary, negotiate item by item so that subjects on which an agreement has been reached can be removed from the list.
Take care! The terminology employed can be important. It is better to refer to “items still to be discussed” rather than to “items still to be negotiated,” as you do not want to give the impression that you are willing to give ground on all those items.
Take the Initiative to Seal the Deal
The concept of concluding negotiations varies depending on whether it is a “single transaction” or “sales negotiations.” For a “single transaction,” it is advisable for the seller to trigger the conclusion. In practice, it is a case of overcoming the customer’s hesitations and avoiding a competitor being given an opportunity to seal a deal before you do. For sales negotiations, the seller must also take the initiative, but for different reasons. Indeed, buyers can only really take the initiative if they are convinced that they have exhausted all the seller’s potential concessions. Thus it is in their interest to wait for the seller to propose a final deal.
Presenting justifications, suggesting alternatives, and proposing without imposing are the best means of presenting a final deal.
You must remember a simple maxim: Your counterpart must be content with her negotiating. However bitter the exchanges and whatever is at stake, you need to ensure that the other party leaves the negotiations with a feeling that she “made a good deal.”
If I am the buyer, what might give me this feeling?
- Having paid less than the list price
- Having paid less than expected
- Other people telling me that I have made a good deal
- The conviction that I have succeeded in getting “the best possible deal”
- The feeling that I have obtained a product that someone else wanted
- The impression that my decision proves my ability (or my taste, my resources, my boldness, my humor, etc.)
- Certainty that I will not regret my decision in the future (purchase offering security)
- Having paid less than I would have done elsewhere for a similar product
- Having paid less than others do
If I am the seller, what might give me this feeling?
- Having sold at a higher price than that demanded by the buyer
- Having sold at a higher price than expected
- Other people telling me that I have made a good deal
- The conviction that I have succeeded in doing a deal that my competitors were really keen to do
- The impression that the outcome proves my ability
- Certainty that I will not regret my decision in the future
- Having sold at a higher price than I would have gotten from other customers for a similar product
- Having sold at a higher price than others would have gotten (e.g., my competitors)
Clearly it is in your interest to give the other party reasons to be satisfied, but those reasons need not be costly for you.