Successful negotiators are those who look for a win/win solution. Their goal is to achieve a mutually acceptable result that is beneficial for both parties. However, every negotiation involves a little give and take in order to achieve this goal. There are almost certainly going to be a number of concessions that occur during the negotiation. The question is: How do you know when and how much to concede? After all, conceding too much can move you away from a successful result and conceding too little can leave you with no deal at all. Here are a few concession strategies that will give you the best chance of achieving those win/win results.
- Prior to the negotiation, make a list of some concessions you are willing to make and what you would like in return. Some examples of concessions might include price adjustments, extended deadline, waiving additional registration or set-up fees, altering the length of contract, etc. Prioritize this list from “Most Important” to “Least Important” so you will know where to begin when you make concessions during the negotiation. You also need to have a clear understanding of how much your counterpart values each concession. For example, there is no need to concede on price if your counterpart is willing to pay it. Perhaps it is the length of the contract that is holding them up. Understanding the value of these concessions will help you navigate the negotiation.
- Never make concessions without asking for something in return. Look at it as though you are doing something for them so they must do something for you. Your counterpart should understand that anytime you offer to make a concession, it is contingent upon a reciprocal concession of equal value.
- Always concede small! If you make a large concession right out of the gate, you immediately weaken your negotiating credibility. Your counterpart will assume that if you are willing to give so much up right off the bat, how much more slack will you be willing to give as the negotiation continues. Always start small and only concede enough to keep the negotiation moving forward. When you make multiple smaller concessions, it gives your counterpart the feeling that you are flexible.
- Make concessions slowly. If you concede too quickly, your counterpart won’t really see it as a concession because it won’t seem as valuable to you. Make sure they understand the value of what you are conceding so they grant something in return.
- Only make concessions when they are in your best interest. Your counterpart might offer to “split the difference” or make some other offer that is actually more beneficial to them. Remember that the purpose of making concessions is to achieve a win/win solution…so there has to be something in it for you too!