How to Use the Bluff Properly During Negotiations

The Oxford English Dictionary defines bluffing as “threatening or confident language or behavior adopted without basis, in order to intimidate or mislead an opponent.” In turn, lying is defined as making “an intentionally false statement” and being “deceptive.” The difference can be summed up as follows: A liar always makes claims, whereas, under certain circumstances, a bluffer merely makes suggestions. Above all, though, a liar wishes to deceive, whereas a bluffer wants to impress or intimidate.

In business negotiations, not only are you entitled to bluff to some extent, but it is your moral duty. Not a duty to the other party, of course, but to the company you represent. Indeed, since the stakes and risks are high, negotiators cannot allow themselves to reveal the constraints they are under.

If a buyer receives formal instructions to do a deal with one of the suppliers consulted, can she admit this to the latter without betraying her own management? If a seller is obliged to clinch a sale in order to achieve his objectives, can he reveal this to the buyer without sacrificing his own company’s interests?

While bluffing is essential, lying must be avoided, if only for practical reasons: If your lie is discovered, you will be in a weak position, not only in the ongoing negotiations, but also in all those that are yet to come. Your arguments will be met with skepticism, your promises with mistrust, and your warnings with indifference. Thus there are several types of bluff that you can use.

Bluffing by Omission

Generally an inoffensive tactic, bluffing by omission merely requires you to avoid revealing certain crucial information. For example, as a seller, you might omit to mention that your new product has been rejected by most of your other customers. Meanwhile, as a buyer, you should be careful not to reveal that your supplier is the only firm in contention since their competitor has withdrawn from the race.

Bluffing by omission is the bare minimum required to entitle you to participate in business negotiations. If your moral principles prevent you from resorting to this, you would be well advised to opt for a career at some distance from the business sector.

Bluffing by Suggestion

Bluffing by suggestion requires you to encourage your counterpart to form a picture of the situation that is at some variance with reality, without going so far as to make specifically inaccurate claims. For example, as a seller, you might comment with regret, “It’s not easy to get hold of the product quickly at the moment, given the level of demand.” In reality, you are getting so few orders that the product is only being manufactured on a one-off basis on demand. In your counterpart’s mind there are so many orders that production is struggling to meet demand.

Alternatively, as a buyer, you might sigh and tell the seller, “I don’t understand why there should be such a disparity between the prices that two suppliers offer for the same product. I think you’ll have to do better than that.” In reality, the seller across the table has already made the cheapest proposal.

Used with tact and in moderation, bluffing by suggestion can prove effective in certain negotiating contexts.

Bluffing by Exaggeration

Bluffing by exaggeration consists of exploiting a proven fact while distorting or magnifying it to help enhance your position. As a seller, you might claim that “almost 80%” of a product’s components are manufactured individually in Europe, which explains the high production costs, when just 60% of components are affected, the rest being mass-produced in low-cost countries. As a buyer, you might claim that “one of the global market leaders is prepared to accept a price 15% lower for the same service,” when the price disparity is just 10%.

Even if you may regret it from an ethical perspective, such bluffing by exaggeration is part of the game and is tacitly accepted in most business environments, provided that it is only pursued orally and does not go so far as to constitute complete deception.

Any experienced seller knows that he needs to take a buyer’s claims about business prospects with a pinch of salt during price negotiations. Equally, every buyer knows that she should treat with caution the commercial claims presented by a seller wishing to do a deal with a new customer.

If you go beyond bluffing by exaggeration, however, you become involved in forms of bluffing that are akin to lying and must be rejected under all circumstances.

Bluffing by Invention

Bluffing by invention involves openly making false claims. A seller may claim, “Our product has been licensed by the relevant American authorities,” when the procedure has not even begun yet. A buyer may declare, “The comparative tests carried out with your competitor’s product proved conclusive,” when no such tests have been planned. Such bluffing may temporarily impress and influence the other party, but if discovered, it will destroy trust and have a lasting impact on the reputation of your company.

Bluffing by Making False Promises

Lastly, bluffing by making false promises consists of making commitments that you know you cannot keep. A seller may claim to be “certain that we can meet the deadline,” when he knows that such a commitment is totally unrealistic. A buyer may undertake to end payments in arrears once and for all, when she knows she has no control over the accounts payable department.

It is true that unfulfilled commitments can sometimes allow you to clinch a complex deal. Yet they inevitably lead to disappointment and frustration. This will be all the greater where the victim suspects that the perpetrator has acted to his detriment deliberately and with great cynicism.

However, you can only assess the success of negotiations based on how an agreement is implemented. Its implementation will largely depend on the other party’s state of mind: active, friendly cooperation and strict abidance by the contract, or bitterness and a desire for revenge. Over the long term, you never win by deceiving those who place their trust in you.

In conclusion, bluffing is an essential negotiating tool. If bluffing remains within bounds and involves omitting to mention certain constraints, suggesting certain advantages, or exaggerating certain benefits, it will generally prove useful to you. However, if it leads you to propagate falsehoods or make false promises, it is almost certain to do you serious and lasting harm.