May 20, 2020 by Dymphna

The Art of Negotiation – Establishing a Need to Create an Ideal Outcome

To negotiate successfully, you must not go in with only the idea of “winning”. It’s all about ensuring that all parties get their needs fulfilled.

What is negotiation?

I see it as a form of navigation. To negotiate successfully, you must navigate the path using a process that brings you to a predetermined outcome.

In the end, it’s about problem-solving in a way that brings a satisfactory outcome to more than one party. 

This is as true in real estate as in any other form of business.

Negotiation is not about control.

It’s not about learning how to manipulate somebody so that you get your way. And it’s certainly not about dominance. 

The key to negotiating successfully is to understand that there’s something that the other party needs from this situation.

And once you’ve identified that need, follow these tips to create the outcome that both parties want:

Tip #1 – Wrap Your Solution Around Their Needs

When you try to assume the mantle of power in a negotiation, you make the other person wary. They start to see you as the salesperson who’s trying to get them to make a deal that they don’t really want.

More importantly, you’re not providing them with a solution.

Once you’ve identified the need, whatever it may be, you need to wrap a solution around it. Position yourself as the person who can fulfil that need during the negotiation.

When you do this, the other party feels like they’ve had a win. They feel like they led the process because it’s their need that was the focus. And once they strike a deal, they’re happy that they got at least some of what they wanted.

Tip #2 – Always Talk to the Decision-Maker

Did you know that not everybody negotiates in person?

In many cases, the true decision-maker delegates the negotiation process to somebody else. So when you’re talking to that person, you’re not negotiating with the actual person who pulls the strings.

And that means anything you say gets back to the decision-maker after going through the filter of another party.

That’s why you need to identify the decision-maker before you start negotiating. Make sure that they’re always present because it’s only they who can tell you what they need.

Tip #3 – Show Strength of Character

Your goal is to gain the confidence of the other party. But this doesn’t mean you come in on the wave of some big ego trip.

Instead, you need to show up with a strength of character. Make it clear to the other party that you want to find the best solution for all involved. But you also have to make it equally clear that you’re prepared to walk away from the deal if that doesn’t happen. 

By doing that, you’re creating authority in the situation. You show them that you’re not going to get bullied. But do it in a way that ensures you don’t become the bully.

Understand that there’s always another potential deal around the corner. This allows you to enter every negotiation with the relaxed confidence needed to build credibility.

Tip #4 – Establish the Highest and Best Outcome

It goes without saying that you need to enter a negotiation with your best outcome in mind.

But we’re not talking about your needs here. You also need to know what the highest and best outcome looks like for the other party.

Talking to them can help. But it’s also a good idea to leverage social media to your advantage here. Check them out on Facebook and gather as much information about the person as possible.

For example, do they have a family?

If that’s the case, their need may relate to providing the best possible life for that family.

Are they talking about going through a divorce?

In this situation, the highest and best need is likely a quick sale of the property.

A little social media stalking can teach you a lot about a person. It can clue you into some of the motivations that they don’t tell you about upfront.

Tip #5 – Ask Questions (And Spend Most of Your Time Listening)

So many people make the mistake of thinking that it’s the talker who’s in control of the negotiation.

But that’s not the case.

It’s the person who asks questions who is in control. That’s because it’s this person who’s doing the better job of understanding the other party. 

Furthermore, if you’re the person asking questions, you’re also the person who’s guiding the conversation.

So come in prepared with questions that help you get to the root of the other party’s needs. And as importantly, listen to what they tell you. Allow them to talk while you gather more information that helps you to reach the desired outcome for all.

Tip #6 – Don’t Rush It

Remember that you’re not always dealing with experienced real estate professionals in a negotiation. The other party may have very little experience, which makes them wary.

You can’t rush these people.

If you do, you risk coming off as the pushy salesperson who won’t let them get comfortable. And you decrease the likelihood of making a deal if that happens.

Give them the time they need to acclimatise and feel like they have a measure of control. Only then should you get to the nuts and bolts of the deal.

Tip #7 – Prepare to Give a Little to Get a Little

It’s good to go into a negotiation with your ideal scenario in mind. But the likelihood is that you’ll need to compromise to make sure the other party gets what they need.

We recommend creating a list of what you want out of the negotiation. From there, split the list into things you have to get and things that are nice to get. The latter are those that you may have to give up on to get what you have to get.

But the good news is that by compromising like this, you’re giving the other party more of what they need. And that moves you closer to getting what you want.

Negotiation is Not About Manipulation…

…It’s about working in both party’s interests to achieve an outcome.

These seven tips will help you to establish the other party’s needs. They will also help you to take the correct course of action once you know what that need is.

Don’t treat negotiations like some big power struggle.

Treat them as a situation that allows all parties to navigate to an ideal resolution.