Key Stages in the Business Sale Process – Stage 4 – Negotiation (Part 2)
The nature of the transaction drives the style of negotiation. Are you building a relationship or hard bargaining? Apply one style to the wrong type and agreement will be very hard to reach.
There are a very wide range of tactics used to help strengthen the position of one party. These range from the familiar “I’ll have to speak to my boss”, to the Mother Hubbard ploy of poverty. And beware the overly friendly approach or personal favour.
One client I know was asked to play golf with his Japanese agent – and arrived at the course to be given a brand new set of clubs and bag which he was to take back to the UK! Generous one would think until you put in the context of forthcoming negotiations on agency agreement and discounts, running into many hundreds of thousands of pounds! Beware generous gifts.
Some good maxims to take into negotiation include:
- Nothing for nothing (don’t concede without getting a concession in return)
- Negotiation takes place in the other persons head! (It is not what you are thinking that is important, it is what they are thinking – and how can you influence it.)
Good Negotiation requires a very wide range of people skills, where success is more about the control of emotions than an A-B-C approach. What is appropriate behaviour in the circumstances?
Negotiating effectively under pressure is the key. If it is your business and your retirement at stake it does not generally bring out the best negotiating stance.