Negotiation – When is the right time to walk away?

What is negotiation? And when is the right time to walk away?

 Ideally, negotiation should be a discussion to achieve the best deal for both parties by working towards a Win-Win result and subsequently maintaining a long-term trusting relationship.

However, have you ever regretted paying so much more than you intended for goods or services; or felt that you obtained far less than you had hoped for during contract or salary negotiations? How about being set ‘impossible’ deadlines?

negotiation course

Would you be able to retain an ongoing relationship with an organisation after being ‘forced into a corner’, rushed into a decision or overcharged; or wish to continue doing business with a company or individual trying to ‘squeeze every last penny’ out of you?

Negotiating is not confined to business and there are numerous occasions in your personal lives when you negotiate with your partner (choosing a restaurant), children (TV time), salespeople etc. When is it time to find another dealership when your car salesman won’t ‘give an inch’; or advertise for another buyer when someone is unwilling to offer a satisfactory price for your precious heirloom?

In all these cases, any agreement tends to be short-term, usually with a ‘winner’ and a ‘loser’. Even a compromise (meeting halfway), may result in both parties ‘losing’ and walking away unhappy, not caring about the consequences.

Planning for negotiation

How can you work towards a Win-Win outcome to ensure a long-term, productive relationship and a willingness from both sides to engage in future opportunities beneficially?

The key is to plan your strategy in advance, know exactly where your limits lie and, critically, the point at which you will walk away to find a more acceptable solution. Of course, you then need the courage and conviction to do so.

Let’s consider a 3-step approach to a negotiation which could involve money, time frames and/or additional elements/conditions depending on your objectives.

You need to decide on your:

  • Ideal Position
    • The best option or deal for you
  • Realistic Position
    • What you believe both parties will agree to
  • Fallback Position
    • The one you won’t go below (or above)

For example, if you are negotiating to purchase parts from a Supplier, you would start low:

  • Ideally, you would like to pay £5,000
  • Realistically (based on experience and research), £7,000 may be achievable
  • You would not be willing to pay more than £9,000 (Fallback)

The Supplier, however, wishes to sell to you at the highest possible price, so they would start high:

  • Ideally £10,000
  • Realistically £8,000
  • Fallback £6,000 (no less)

These Positions should now allow some flexibility in reaching a mutually satisfactory agreement during discussions.

BATNA Best Alternative To a Negotiated Agreement

Understanding BATNA

In the above case, if the Supplier insists on £10,000, for example, you now have to assess your BATNA since that figure is above your Fallback Position.

Therefore, you are unable to reach a satisfactory conclusion and risk sacrificing too much. What is your best alternative and do you wish to maintain your relationship with that Supplier?

  • Decide if and when to walk away
  • Ask for more time to think about it
  • Discuss possible add-ons or incentives
  • Find another Supplier
  • Produce the parts yourself
  • Take legal action

If you apply the above example to buying a car you really like, maybe you can ask for extras (higher spec sound system, longer warranty, free services etc), delay your decision or reluctantly leave to find another dealership (that might even encourage the salesperson to reconsider the price).

The underlying factor is how important you feel it is for you to continue working effectively with the other party.

Find out more about Negotiating Skills with STL.

Conclusion

Prior to a negotiation, ensure you are clear about your objectives and, particularly, the three Positions you are aiming for.

Decide whether you wish to maintain an ongoing relationship with the other party in order to leave your options open for future opportunities together and consider the implications of the BATNA you choose.

If you cannot reach a mutually agreeable outcome, don’t be afraid to walk away in the face of risky and/or unacceptable conditions imposed by the other party.

 

 

 

PRESENTATION SKILLS MASTERCLASS

How to Handle Questions Confidently

How do you top off a successful presentation? You need to ensure your audience goes away not only feeling informed but impressed and won over. The end of your presentation gives audience members a window to engage with you and ask questions. For you, this is an opportunity to restate key messages, provide greater detail where necessary and most importantly make lasting impressions.

However, as we give THEM control, questions at the end are also where the wheels can fall off your presentation! Handling questions and objections well is an essential skill for those making winning proposals, pitching their service or responding effectively to interrogative questioning in a range of business activities.

STL-presentation-skills-london
Presentation skills masterclass

Once you reach the Q&A section of your presentation, there are some straightforward steps to maintain composure and handle questions efficiently and masterfully:

Thank them

When a question lands, the first thing to do is thank the audience member asking because thanking generates positive emotions which help you to build rapport. If you are threatened by tough questions or objections, thanking can placate the questioner and keep other audience members on your side. Empirical science agrees: gratitude is a basis of power.

Clarify

Next, ensure that you fully understand what the audience member has asked. In order to do this, you need to clarify the question. The most effective way of clarifying in a Q&A session is to paraphrase what you were asked because the audience member will have confidence in you and you can answer the question correctly. Besides that, you have more time to consider your response.

Amplify

In a small room with 10 or so members this step may not be necessary, but in a conference space with an audience of 200, most people will not have heard the question. Clearly re-state it so the whole audience understands the context for the answer you will provide.

Answer

Now it’s time to answer the question. Answer as clearly and concisely as possible. If it requires too much time, or you would need to provide data that you don’t have to hand, informing the questioner that you will get back to them later will help you stay on track. However, its essential to confirm the questioner is happy with this.

A problem that some of the most experienced presenters have is focusing only on the questioner when giving an answer because the rest of your audience will lose interest. Therefore, make eye contact with all audience members to keep them engaged and involved.

Confirm

Before moving on to the next question, ensure the answer you have provided satisfies the questioner by confirming with them. Moving on too quickly could give the impression you are concealing something and frustrate audience members who want to follow up.

Conclusion

When you get to the Q&A session in your business presentation, these five steps – Thank, Clarify, Amplify, Answer and Confirm – can help you to stay composed, keep momentum going and perform masterfully.

Presentation Skills is part of our Business Skills Excellence Programme – along with many other core business skills like our minutes writing course and time management course. Take a look at our course finder to see the whole range!