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The Big Mistake People Make When They Negotiate
Guest articles > The Big Mistake People Make When They Negotiate
by: Lisa Earle McLeod
We were selling our house. The buyers wanted to play hardball negotiation.
We had agreed on a price, but they wanted us to throw in lots of extras, furniture, the clay pots on our front porch, rugs. We were OK with all of it, until it came to the fish tank.
Our then three-year-old daughter had a giant fish tank that she and her father had spent a year stocking and caring for.
It was the centerpiece item in our basement playroom, and the buyers wanted it.
It was probably worth about $500. They insisted that we leave it. We caved, they got the tank, and we had to break the news to a three-year-old that she was going to have to leave her fish behind.
Did they win?
Not exactly. They got the tank, but they created ill will amongst our neighbors before they even moved in.
Because here’s the part they failed to consider: While they were playing hardball, we were updating our neighbors about the entire process.
The night of the big fish tank fiasco, we were at a neighborhood party. The entire neighborhood weighed in on whether or not we should let them have it. The general consensus was to let it go.
One neighbor summed up the sentiment of the evening saying, “I know it would be a pain to move, but what kind of people try to take away a little girl’s fish?”
Which is how they’re known as, “The couple who stole Elizabeth’s fish.” The neighbors were predisposed to dislike them before they had even met them.
They made a classic mistake; they thought they were conducting an impersonal negotiation. But for the buyers (us), and our team (our neighbors) it was completely personal.
There are two types of negotiation. The kind where you don’t care what kind of reputation you’re creating, like a hostage negotiation. Once you get your hostages out, the tough guys storm in and throw the evil perp to the floor. You don’t care what the person on the other side of the negotiating table thinks about you or what they tell others.
The other kind of negotiation is when you’re negotiating prices and terms with people that you’re eventually going to have to work with.
Or in the case of our homebuyers, with people that are going to talk about how you behaved, and your reputation will precede you.
This happens in business all the time. A tough buyer pushes a salesperson to lower the price to the point where the vendor isn’t even sure they want the deal. Because the salesperson is invested, they start making concessions, promising their boss that they won’t have to provide extra services, cutting corners, etc.
The deal closes, but the customer who pushed too hard winds up getting the B player service team. No one is excited about having the account, there’s no innovation, no going the extra mile. Every time the customer calls they try to pass him off.
I’ve coached executive teams through negotiations of deals in the millions. Here are three techniques we use to increase success: