Negotiating from a Position of Power

There are times when two coworkers with paychecks that are complete equal are able to drive home in two very different cars. They might own the exact same amount of money on their cars, but one coworker is driving a five-star vehicle and the other coworker has a three-star ride. What is the difference? The coworker with the five-star vehicle utilizes more sophisticated negotiation tactics.

There are many cases in life when the price of an item is open for negotiation. Negotiation skills come in handy when asking for a raise, looking for a better deal on a car or when slashing the price of a home.

The first step in the negotiation process is for the negotiator to be clear on the highest and lowest price that the negotiator is willing to pay. By understanding the cutoff point, the negotiator can then make it clear that he or she is not a buyer at a particular price.

Very rarely will a negotiator be able to succeed with a win-lose proposition where the negotiator is the winner. The negotiator must give almost as much as he or she intends to receive. The negotiator should try to give the other party as much as he or she wants while getting the better deal overall.

Tough negotiations are tough. This statement might sound obvious, but negotiators should never expect that the other side will go down without a fight. For example, with car sales, the salesman will try to sell the car for the highest price possible.

When the car buyer knows what price to shoot for because TrueCar reveals the best price for a new car, the car dealer will not likely be willing to sell the car for a low price. Tough negotiations take time and the salesman might return to his manager multiple times before finally agreeing to the low price. The key is to only raise the price enough to get an excellent deal.

Ideal negotiation strategies vary depending on who the other party is. With a car sales associate, the hardline approach may work because the customer is unlikely to see the sales associate again. With a boss, the hardline approach may not be ideal because the employee will come to work and see the boss everyday. With salary negotiations, it is more important for the employee to articulate how he or she brings value to the employer.