12 Negotiation Tips For People Who Hate Negotiating

I hate negotiating, mostly because a negotiation often feels confrontational and I tend to shy away from confrontations.

But negotiating is a fact of business life, so are some ways to make your negotiations less painful, more fun — and most importantly more successful.

1. Go first. Many people hate to be first to toss out a figure because they think they might miss out on an opportunity. ("If I offer $10k and he would have been happy with $5k I'll spend a lot more than I have to.") Occasionally that might happen, but it makes more sense to go into a negotiation assuming the other party is smart and has a reasonable sense of the value of whatever they want to buy or sell. Making the first offer lets you set the "anchor" for negotiations to follow. Studies like this one show that when a seller makes the first offer the final price is typically higher than if the buyer made the first offer. Why? The buyer's first offer will always be low, which sets a lower anchor. In negotiations, anchors matter.

2. Be quiet. When we're nervous we tend to talk a lot and therefore miss a lot. Let silence be your friend. If you make an offer and the seller says, "No way," don't respond immediately. To fill the silence the seller will give reasons why your offer is too low… and in the process may give you information you wouldn't have received otherwise. Stay relatively quiet, listen, and when you do speak, ask open-ended questions. You can't meet in the middle (or, hopefully well to your side of the middle) unless you know what the other party really needs. Give them time to tell you.

3. Know what you want. You should always know what you need — and what you're willing to spend or pay. If you don't have a clue about the cost of a particular service, don't expect the other party to educate you; that puts even the most ethical person in an awkward position. At the least have a sense of the market price for the product or service you want to purchase. Then you can adjust your offer based on the quality and quantity you will actually receive.

4. Assume the best case. High expectations typically lead to high outcomes. Ask for what you want, and go into the negotiation assuming you'll get it. Why not? You can't receive if you don't ask. My wife is the eternal negotiation optimist; she always assumes she can make a deal on her terms. And she almost always does — because she confidently asks for what she wants.

5. Avoid setting ranges. Service buyers often ask for estimates in ranges: "I know you don't have all the information you need, but based on what I've told you, what's a ballpark figure?" Ranges create anchors too. If you don't have enough information to provide a solid estimate, don't. And never say, "Well, somewhere between $10k and $20k…" because the buyer will naturally want the final cost to be as close to $10k as possible, even if what you're asked to provide should cost well over $20k.

6. Only make concessions for a reason. Say a buyer asks you to cut your price, saying, "All I can afford is $500." Make sure you get something in return. Say, "For $500 I can do X and Y," and take Z off the table. Every concession should involve a trade-off of some kind; otherwise your price was simply too high to begin with. Use the same logic if you're buying; the classic home negotiation move is to ask for, say, all the appliances and fixtures when you counter at a higher number. Always ask for something in return, and don't be afraid to ask for things you don't really want early on so you have items you'll be happy to take back off the table later.

7. Never be Harry Truman. Truman kept a sign that said "The buck stops here" on his desk to remind him that his was usually the final decision. In negotiations it's tempting to say you have the final word and ultimate authority (especially if that's true.) Don't. To avoid getting cornered or pressured, always have a reason to step away and get the okay from another person, even if that other person is you.

8. Make time your friend. Never, ever rush. Never see a negotiation as something to wrap up as soon as possible. A negotiation is an investment in time, and most people don't want to lose their investments, so the more time the other person has in a deal the more they'll want to close the deal — and the more they will voluntarily give up in order to get you to say yes.

9. Ignore face value. Negotiating is a little like being on Survivor; in the spirit of the "game," many people feel it's okay to be less than forthcoming or honest. Don't assume everything you hear is true. Statements like, "I can't go a penny lower," are more likely to be negotiating tactics than truths. Listen, but toss a few grains of salt onto what you hear. Look closely for what lies under the posturing and positioning.

10. Give the other person room. People get defensive or attack when they feel trapped, and neither helps a negotiation move forward. Push too hard and take away every option and the other party may have no choice but to walk away. You don't want that, because you should…

11. Forget about winning and losing. Negotiating can feel like a game but it's not. No one should win or lose. The best negotiations leave both parties feeling they received something of value. That's how you want a negotiation to end up, because a negotiation should…

12. Create a relationship. Take, but don't take too much. Give. but don't give too much. Establishing a long-term business relationship should always be your goal.

And when you've finalized the deal, say thanks — and mean it.

Thanks to Jeff Haden / BNet / CBS Interactive
http://www.bnet.com/blog/small-biz-advice/12-negotiation-tips-for-people-who-hate-negotiating/5080