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Keeping Negotiations On Track
Sometimes negotiations stall because one or both parties believe that if they hold out, the other side will give in to their demands. To encourage further discussion:
- Know what you have to lose. Say, “Let’s look at what will happen if we don’t reach agreement.” Then list the disadvantages for both the buyer and the seller.
- Focus on the positive. Maximize the areas of agreement and minimize the areas of disagreement.
- Ask for further explanation. For example, to a seller, say, “The comparable properties I’ve looked at don’t seem to justify your asking price. Perhaps I don’t understand something. Why are our numbers so far apart?”
- Break the problem into its components. See if there are points of agreement within the area of disagreement. Assume, for example, that the problem is price. Ask the buyers if they would consider paying a higher price if the sellers took back a second mortgage.
Source: Adapted from"Power Real Estate Negotiation," by William H. Pivar and Richard W. Post (Real Estate Education Co., 1990)
TIP: Sometimes people invest so much energy in a negotiation that they feel obligated to reach agreement, even if the benefits don’t justify the cost. Knowing when to stop a negotiation is just as important as knowing how to keep one moving.
When and How to Make Concessions
Because negotiating is a give-and-take process, come prepared to make concessions. As you plan, identify concessions that are important to the other party but of little or no value to you. Then, during the negotiation, watch for opportunities to use your concessions advantageously.
Experienced negotiators:
- Avoid making the first concession, and never make the first major concession. Doing so sets up the dangerous expectation that you are a pushover.
- Ask for a trade-off by saying, “If I do that for you, what can you do for me?” Show that each time you meet one of the other party’s demands, you’ll make a counter-demand.
- Offer concessions of decreasing value. Making smaller and smaller concessions will imply that you’re reaching your limit and will discourage the other party from asking for more.
- Keep track of the concessions both sides make. Use the resulting scorecard to show how generous you’ve been and to encourage the other side to make additional concessions when high-value issues are on the table.
Source: Adapted from “True Negotiation: An Exchange of Satisfaction,” by Richard J. Laser (The Real Estate Professional, September/October 1990)
Q&A: Taking Clues From Body Language
Body language is an important element in negotiation. Use it to convey your message to the other party, and read it to gain insight into what other people are thinking.
Paul Sutherland, author of "Buyer Representation from A to Z," says that about 57 percent of your message is received through body language, 36 percent through tone of voice, and only 7 percent through the actual words.
How can a salesperson tell if people are responding positively or negatively to an offer?
Sutherland: Look beyond the words. Facial expressions, seating posture, and the gaze of the eyes can speak volumes. Does the client appear bored or inattentive (no eye contact, looking around the room) or actively involved and cooperative (sitting forward, listening)? Repetitive gestures such as touching the hair, adjusting eyeglasses, or drumming fingers suggest that the client is feeling anxious while disagreement may be indicated by a person sitting back in the chair with arms folded.
How can a salesperson control body language to be a better negotiator?
Sutherland: Nonverbal messages evolve from an inner sense of self-esteem, so better body language must come from the inside. Salespeople should get comfortable with themselves, then their gestures will reflect that inner confidence. If salespeople want to be successful, they need to make certain that their body language, their words, and their tone of voice are all congruent.
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