Negotiating A Win-Win Deal – Every Time

Negotiation is a wonderful thing. When two or more human beings agree to speak openly, honestly, and with everyone's best interests in mind, that is when authentic, collaborative, and genuinely win-win relationships can be developed.

Using a car purchase as an analogy, have a think about the following scenario:

Car dealers are having a really tough time and you decide that it's time to make the purchase for your new vehicle. But, as you already know that the car sales industry is struggling, at least for the foreseeable future, you decide that you are in a very powerful negotiating position. You think, 'He will want to sell me the car more than I want to buy it.'

The brand new, shiny car will bring you adulation, a few 'wows' from colleagues and friends the first time they see you in it. But remember, you only ever get one 'wow' from anyone, and the car’s value has already lost a few thousand pounds within seconds - not minutes – of your purchase. Watch out, there are more shocks to come!

The car is priced at £20,000. It's the very car you had set your heart on. But you already know the dealer doesn't really expect you to pay £20,000. They've put the price up in order to come down in price later. The negotiation is about to commence. With your insider knowledge of the car market, you decide to be really cheeky and offer over the telephone a paltry £14,000 or it's no deal. Your expectation is that the dealer will return with a counteroffer which will reach somewhere in the region of splitting the deal 50/50.

The phone rings. It's the dealer.

As you are the lucky customer this week and they appreciate your business, they have decided to accept your offer of £14,000 for the car (which, remember, retails at £20,000). What are your first thoughts when they accept this without a fight? Maybe:

I could have done better.

I should have started with a lower offer.

There must be something wrong with the car for them to give in so easily.

What you didn't know, and the dealer wasn't about to tell you, was this: their profit doesn't only come from the profit made on each car, it is also generated from the volume of cars sold each month. They don't even have to sell all of their stock at a profit, they can sell one or two at break-even price or even a loss. And because you didn't know this, your initial negotiating power has all but disappeared.

When there is a high level of trust in a relationship, both parties are often willing to negotiate a genuinely win-win deal. A deal where the seller can still make a profit and where the buyer can know or at least expect that their needs and wants will be taken care of as agreed. When there is low trust, it's everyone for themselves – an attitude that is both self-serving and self-defeating.

The moral of this story for the workplace? Don't get excited too soon, remain calm and seek to understand as much of the detail as possible. Always keep a win-win mentality very much in mind, creating an environment where all parties can negotiate openly and honestly to achieve what needs to be achieved, and to the standards required. Get the best deal you can, but not at the expense of losing trust and causing toxic relationships.

How are the levels of collaboration and trust in your team? What steps can you take to improve relationships so that when you do need to negotiate, the relationship is solid and based on mutual respect and integrity? Summit is here to help you develop the skills to create high trust relationships and become a better negotiator – why not take a look at one of our training courses?