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Every negotiation involves a little bit of give and take but it is important to know how and when to make concessions. Giving too much too soon can cause you to give up your position and you could end up making a deal that you regret. On the other hand, not giving up enough can cause you to appear difficult and unwilling to compromise and this can jeopardize the deal as well. What and how you concede is a critical part of any negotiation and can move you closer or further away from a successful result. Here are a few strategies to help you make more effective concessions.
Make a list of concessions and what you want in return.
Before entering a negotiation, you need to spend some time reflecting on what is most important to you. Write down a list of essentials and rank them from “most important” to “least important.” Beside each item you also need to write down how much you think your counterpart values each of your concessions. Concessions are expected in any negotiation, so you need to be prepared to trade some of these less important concessions.
Never make a concession without asking for something in return.
When you make a concession, you need to adopt an “I can do this if you can do that” kind of attitude. Anytime you make a concession your counterpart needs to be aware that it is contingent upon a reciprocal concession of equal value.
Never concede too soon.
Making a large concession right off the bat weakens your credibility and puts you in a compromised position. When you concede quickly your counterpart is left thinking, “If they are willing to give that up so easily, I wonder what else they will give up.” It is always important to concede the least amount necessary to keep the negotiation moving forward. When you make multiple small concessions, it demonstrates flexibility.
Never agree to something you know you cannot deliver.
The pressure to reach an agreement can sometimes be intense and negotiators might end up making a deal that they cannot truly commit to. Failing to deliver on your promise can be detrimental to any future dealings with a customer and will cause you to lose all credibility and tarnish your reputation. Therefore, it is so important to think through each concession and not act on emotion. You must only make concessions that are realistic.
Never give up what is most important to you.
Every good negotiator has a walk-away point. You MUST know your walk-away point before entering any negotiation. While negotiation requires give and take, there might be certain things you just cannot give up and you need to remain firm on that. All too often negotiators cave and give up concessions that they didn’t want to just for fear of losing the deal. It is important to identify when the deal isn’t worth the concessions and in such cases, you need to be willing to walk away.