The starting point for all negotiation is knowledge of the facts and circumstances surrounding the deal. The more you know about the product, and all the people involved in any particular negotiation, the better. One of the reasons that so many pages of the book were devoted to goal setting was so you would know what benefits you expect to get and what you would be willing to sacrifice to get them. Usually, this boils down to financial terms and timing, but it can also include the amount of work you are willing to do to make a deal.
Raw greed only kills deals. The key to negotiation is to start with a well-defined goal and to know what you're willing to sacrifice to reach it. Gathering information about the true state of affairs, the property, mortgage and tax details, the urgency of the situation, and the cost to the other party of not making a deal is critical. You must invest time in patient questioning and listening to the answers in order to separate what the other party wants from what he perceives he needs. Fulfilling his needs is your currency in the transaction.
Think of it this way....
Failure to reach agreement as to value can break a deal wide open, so it pays to negotiate around this obstacle. This pretty well sums up the way that negotiation techniques earn their keep when buying or selling, and can secure quality homes at wholesale pricing.
There’s an old Italian proverb that more or less says a man can steal a whole loaf of bread if he does it a slice at a time. This incorporates two principles:
When negotiating for price or terms, there is no incorrect answer. It all depends upon the viewpoint of the people involved. Who's buying? Who's selling? Why? What are their objectives? How much cash must actually be required to make the transaction work for all parties? What are their income levels and tax brackets? What are their ages? How sophisticated are they? What has their previous financial experience been? What are their security needs? How motivated are they? Why?
When negotiating a purchase, the 'WHY' question precedes What, but when selling, the 'WHAT' issue should come before the 'Why'. You can't scratch an itch until you find it. Because negotiation is essentially a problem solving technique, you've got to understand the motivation of the other party. I have a sort of pecking order for motivation. I place greed at the very bottom in terms of probably negotiating success. What I look for are personal factors.
'HOW'? Ah, there's the rub. All we've done thus far has been to define the problem. Solutions are the tricky part. By and large, if you don't provide an acceptable solution, you don't make your deal. But the more thoroughly you understand the problem the more probable that you'll be able to find a solution. The most interesting part of this process is that other buyers can't compete effectively once the seller sees that you're trying to solve his personal problem while acquiring his property.
When buying, the 'WHY' question precedes What, but when selling, the 'WHAT' issue should come before the 'Why'. You can't scratch an itch until you find it. Because negotiation is essentially a problem solving technique, you've got to understand the motivation of the other party. I have a sort of pecking order for motivation. I place greed at the very bottom in terms of probably negotiating success. What I look for are personal factors.
When I was about 6 years old, I was afraid to try to swim. I sank like a rock every time I picked my feet up off the ground. So my Uncle took me out in a rowboat and threw me out of it into water that was over my head. In a sink or swim situation, I learned to swim. Fast! Then I discovered something odd. Once I gained the confidence to start swimming, I couldn't sink anymore. I couldn't remain under water without effort. I automatically bobbed to the surface. What caused this phenomenon? Confidence. As long as I believed I couldn't swim, I couldn't. Once I believed I could, I could. This same principal applies to successful negotiation. You've got to really believe that you can get what you want out of a deal before you start. Learning to do this isn't easy, but it's something that everyone can attain with effort.
When presenting unusual offers, you have to sell the 'sizzle' not the steak. Rather than extol the merits of a particular product or financial proposition in itself, you're best served by presenting a picture of how a person's life can be changed for the better by concluding a transaction the way you've presented it. You've got to plumb the depths to create an emotional response in the other party. You can do this by answering what might well be the 5 most important words in the English language: 'What's in it for me?' Answering this unspoken question in the mind of the seller goes a long way toward having your offer accepted.