I hope everyone had a SAFE and RESTFUL 4th of July! I hope you were all able to do as my last blog suggested and “Celebrate your INDEPENDENCE as an entrepreneur by thinking about THIS everyday!” We have to encourage each other on this journey towards success.
On July 3rd in the late afternoon, I had a negotiations teleconference between a client and an opposing party and his attorney. At issue was the negotiation of a business deal in which the opposing party wanted a certain amount for an alleged breach of a contract. My Firm not only drafts and reviews anything that you can imagine in writing but also business negotiations and strategic planning. Liability was NOT an issue in this case—-the actual dollar amount was. Now, we had gone back and forth with this particular client over the course of a month and even had had a previous conference call so this wasn’t our first call to try and settle this business matter. Long story short, we ended up agreeing on an amount in this case that was $60,000 LESS than what the other party requested at our previous meeting.I’ve never seen my client smile so big and it certainly started my July 4th weekend on a positive note. Even though we have a few details to continue to negotiate, the hard work has been completed.
I want to share with you some general negotiating tips on how to get the job done in most business deals! Remember that negotiating is a science (there are numbers involved most times) AND an art form. If you don’t have both, seek professional help. But the negotiating process really is a game of soccer (in honor of the World Cup) in which both parties have to go back and forth to keep the process going.
1. Know the other parties. I’m sure Team U.S. knew the weaknesses and strengths of their competition before they hit the field. They reviewed videos and sought advice from others. Additionally, Team U.S.A. probably knew how the other teams ideally wanted to play. The same is true in negotiations. That means knowing what they ideally want out of the deal versus what you reasonably believe they are willing to tolerate. Doing this accurately and early will put you in a position of power and leverage when the negotiations start. If you don’t know what the other party wants, and won’t make them say it in writing, how do you know where your starting point will be for counteroffering?
2. Be ready with a counter. Just because the other side says “no” or names an alternative you disagree with doesn’t mean negotiations have to stop. Take into account the demands that are being made on the other side, take some time to think and offer a counteroffer if you feel it is satisfactory for your needs and that you can meet your own counteroffer. Again, to keep the process going there has to be communications back and forth. If both parties end with “no” and no alternatives, negotiations stop and that’s not the point of a negotiation.
3. Don’t be upset if the other sides counters. Remember, the other side is trying to obtain the best deal possible for their side, just like you! When you give an offer that you think is reasonable and the other side offers a counter offer, you can either reject it or try to move your offer towards the middle. Either way, it’s a process and emotions should stay their distance during this process. This is especially true when being represented by an attorney because attorneys have fiduciary and legal obligations to their clients. So don’t be offended if the other side is making a hard sale.
4. Be patient. Depending on the deal that you are participating in negotiations, this process could take a while depending on the stakes. It’s ok to check for updates on the other side but the lengthy wait for an answer could mean that the other side is seriously considering your offer, otherwise the answer would be a straight “no” presumably. The key is to continually communicate with the other side as often as possible to keep the conversation going. You can even put deadlines at the beginning of the negotiations on any decisions on offers like “24 hours”, etc. to make sure that the negotiations don’t go stale.
5. Put your offer in writing. This includes counteroffers as well. Complicated negotiations that span over a length of time can cause memories to fail. Not to mention it’s a good idea to have written offers to reflect back upon and reference when needed. Legally speaking, putting offers and counteroffers in writing will help protect you should one party back out of an offer. Also it helps to make sure that all parties understand what was said and consented to before legal documents are drafted.
6. BONUS TIP: All parties will be a little unhappy in a successful negotiation. Period. That’s the point and very definition of a negotiation. If either party is completely satisfied, that wasn’t a true negotiation; it was a dictatorship in which someone received exactly what they wanted and the other parties received very little. The most that you can hope for in that you (or your client) will be as least unhappy as possible but don’t go into negotiations expecting to get what you want. Know what your breaking point is but expect it to get close to that point.
I could do a whole CLASS on negotiating and negotiating tips that I have learned in the almost 7 years I have been practicing law. I would love to hear anymore of your tips that you want to add to help my followers GET THE DEAL DONE! Enjoy the remainder of your July 4th weekend!