Here is the ultimate negotiation…returning from my bike ride on Saturday, my wife and half of the kids greeted me as I pulled into the driveway with the other half of the kids and a van full of mountain bikes – with an offer to take me to see a German Shepard puppy.  I said no, but a few hours later I was the proud owner of a brand new puppy (pictured to the left).

Continuing on with Negotiations….Last week I briefly mentioned today’s strategy in the context of the Good Cop / Bad Cop ploy, but sometimes “I’m not the final authority,” can be used without a bad cop involved – just by the negotiator referring to someone up above…this works well, so be aware of it…

The Strategy

I find this to be more often used by managers than purchasing people.  “The boss will never go for this.”  This strategy makes it look like I would choose you if I could, but together, we must figure out how to reduce the cost.  You negotiator talks as if his authority does not want to know the details, but will not go for the proposed price.  This generally takes place even before a price has been submitted up the ladder.

You may hear comments like, “I’ll send it up the line and see what they come back with,” or  you might even get “Looks great, we’ll get back to you once everyone has a chance to review.”  In either case, the person you are presenting to is saying, “I can’t approve it.”  One of two things can happen at this point; either they’ll come back with a counter offer, or time will pass without any answer, putting more pressure on you, the seller.  When the time is right, they’ll come back, knowing you are now out of time.

As long as you think your negotiator is on your side, you are more likely to hand this all kinds of insider information that will help them get their best price. When the come back, they’ll have all the info they need, and you will be desperate and ready to cave in.

Counter Strategy

Like the Good Cop/Bad Cop, giving away information helps them take advantage of you.  As a trusted adviser, you want a trust relationship, however when the deal is built on value; your time lines, compensation, and margins have nothing to do with the sale as far as the client goes, so don’t go there.  Make the value in this deal all about them, deliver great value, and hold your price.

As I stated last week, refuse to negotiate with those who do not have authority to negotiate.  Instead, agree that they don’t have authority and insist on moving up.  This really should be done as part of the discovery process where you can leverage your need to cover all the bases and liability by interviewing those responsible for the ultimate success of the project.

© 2011, David Stelzl