The Absolute Unbreakable Laws of Negotiation – Brian Tracy (Series 1)

 

Your ability to interact, communicate, persuade and negotiate with others determines your income more than any other factor. It is therefore well worth your while to do everything possible to be very good in this area. In a sense, all of life is a negotiation. You are always negotiating in some way. 

When you drive from one place to another, you negotiate through traffic, letting other people get in front of you and you getting in front of them. When you go to a restaurant you negotiate, first of all, to get a table and then to get the kind of table you most like. You negotiate all the elements of your work life and all the things you do or don’t do. You negotiate prices, terms, schedules, standards and a thousand other details all day long. 

The process is never ending. It is not really a question of whether or not you negotiate. The only question is, “How good a negotiator are you?” One of your chief responsibilities in life is to learn how to negotiate well on your own behalf. You need to be able to get more of the things you want faster and easier than you could if the other person was better at negotiating with you than you were with them. There are twenty-one laws of negotiating that you can learn and practice that will help you to get more of the things you really want, better, faster and easier than ever before. When you use these laws consistently, you will improve every aspect of your life.

1. The Law of Subjective Value:

“The value of anything is subjective; it is determined by what someone is willing to pay for it. Many people are confused on this issue. They think that people or companies or labour unions determine what others will pay.”

However, even schoolchildren know that something is only worth what someone else is willing to pay for it, no matter what anyone says or demands. Prices are merely estimates set arbitrarily in an attempt to guess what people will pay, “what the market will bear.” Every sale, discount, markdown of prices or business bankruptcy is an admission of a failure to guess correctly. The producers of the product or service guessed wrong. Customers did not feel that it was worth what they were asking and either bought something else or kept their money. This is why every negotiation is different and there are no hard and fast rules determining buying or selling prices for products or services. Only the person who is being asked to pay for the good or service, or to pay a certain wage, is in a position to determine what it is worth to him or her. When people say that something should be worth a particular amount, or someone should be paid a certain salary, they don’t realize that the word “should” is meaningless in negotiating. All prices are established arbitrarily, at least initially. But it is only what customers are willing to pay in the marketplace that determines whether those prices are correct. If the prices are too high, the products will not sell or prices will be reduced. The customer in the marketplace will ultimately decide how much will be paid for everything. Where are you experiencing price resistance in the sales of your products or services? How could you increase the value of what you sell in such a way that a critical customer would voluntarily pay you more for it? How could you increase your value and attractiveness in such a way that your company or your customers would willingly pay you more for what you do?

2. The Universal Law of Negotiating: Everything is negotiable.

All prices and terms are set by someone. They can therefore be changed by someone. This does not mean that they will be changed, but it does mean that there is always a chance. When you begin looking at life as one long, extended negotiating process, you will find that almost every situation contains elements that you can negotiate to improve the terms and conditions for yourself and others.

The first corollary of this law says: 
"Prices are a best guess estimate of what the customer will pay."

This means that asking prices are only loosely connected to objective reality. The cost of manufacturing and marketing a particular product or service often has very little to do with the price that is put on it. Price is arbitrary and merely reflects someone’s opinion of what the market will bear at that moment.

The second corollary of this law says: 
"Every price was set by someone and can therefore be changed by someone."

Don’t be intimidated by written prices, either on signs or in letters or contracts. Assume that they are written in pencil and can easily be erased and replaced with something more favourable to you. The key is to ask. Begin today to ask for better prices and terms, no matter what you are offered initially. Make it a game. Ask politely. Ask in a warm and friendly way. Ask positively. Ask expectantly. Ask confidently. But be sure to ask. You will be amazed at how quick people are to improve the terms for you if you ask

3. The Law of Ambition: 

"Every act of human behaviour is an attempt to improve conditions in some way"

Human beings are goal-driven organisms, purposeful in their behaviour, whether their aims are clear or unclear. They are always driven or motivated toward achieving “more” of something, although that something may change from minute-to-minute. This is the entire reason behind buying, selling and negotiating. From infancy to old age, you are ambitious. You want to improve your life, or some part of your life, in some way. If you are earning a certain amount of money, you want to earn more. If you have a certain level of physical health, you want to be even healthier. If you have one home or apartment, you want a larger one, and if you get a larger one you want a second one somewhere else. If you have a car, you want a bigger car. If you have a bigger car you want two cars, and perhaps even a motorcycle or motor home. It is normal and natural and completely human for every single person to continually strive to get more, better, faster, newer and cheaper of everything and anything they can think of. The only limitations on human ambition are the limitations imposed either internally, by the limitations that you place on your own mind or, externally, by the limitations imposed upon you by your personal resources, law and society.

The first corollary of this law is this:

“When you experience dissatisfaction but you do not see how any action of yours will alleviate this dissatisfaction, you will refrain from acting.”

For example, you may be driving an old car and are passed on the road by someone driving a $100,000 Rolls Royce Corniche. You may fantasize and think about how nice it would be to drive such a lovely car but you can’t even begin to imagine earning the kind of money that would enable you to pay $100,000 for a car. Therefore, the sight of the Rolls Royce may cause you to feel dissatisfied with your current vehicle, but it would not motivate you to take an action of any kind. The real differences in levels of ambition are explained by differences in ability and opportunity on the one hand and the intensity of desire and belief on the other. If you really believe that you can get from wherever you are to wherever you want to go, you will be continually taking action to move yourself from your current position to somewhere else. This is why people negotiate.

The second corollary of the Law of Ambition says:

“If you are either completely contented or if you feel completely helpless, you will not act to improve your condition.”

 There are two main reasons why a person does not continually act to improve himself and his life in some way. The first, is because he has reached a state of contentment where he feels that no further improvement is either necessary or desirable.  

Second, the individual has reached a state of hopelessness where he does not think anything he does will make much of a difference. Identify your own personal ambitions. In what areas are you dissatisfied with your situation? Be clear about the better condition that you desire. What steps could you take today to begin moving toward the results that you really want? Where and how could you improve your situation by negotiating a better situation for yourself?

4. The Law of Minimum Effort:

“People always seek to get the things they want with the least possible expenditure of effort.”

You place a high value on your time, your money, your mental and physical energy and your resources. As a result, you do everything possible to conserve them. You use your energies sparingly and you spend them as carefully as possible to get the things you want. You are economical in your choices. You economize. You don’t spend more than you have to satisfy a particular need or to achieve a particular satisfaction. This is major drive behind every negotiation.

The first corollary of the Law of Minimum Effort says:

You cannot consciously choose a harder way to accomplish something if an easier way is available to you to accomplish the same result.

You are structured mentally in such a way that you cannot force yourself to select a more difficult path to your goal if you can see an easier path, all other things being equal.

The second corollary of the Law of Minimum Effort says:

All human beings are inherently lazy in that they follow the path of least resistance to get whatever it is they want.

 Laziness is normal, natural and inherent in all human action. This lazy tendency in human beings has led to every great advance and breakthrough in the world of human science and technology. It is the driving force behind many negotiations. How can you position your offerings in such a way that your customers perceive your products or services to be the easiest way for them to get the benefits you offer? What new products or services could you develop that would offer your customers a faster and easier way to get the things they want? How could you reorganize your life so that you are achieving your goals with less effort? How could you be “lazier” in the very best sense of the word?

5. The Law of Maximization:

“People always strive to get the very most for the very least in any exchange of time or money.”

This is just a simple and obvious explanation of human behaviour under almost all circumstances. However, it is an extraordinarily important law of negotiating for you to know. It enables you to avoid confusion in interpreting and understanding the behaviours of other people.

The first corollary of the Law of Maximization says:

When given a choice between more and less, all things being equal, you will always choose more in order to maximize your situation.

This is a category of all human action or behaviour. You are designed in such a way that you cannot consciously choose less pleasure, satisfaction or fulfilment if you can have more for the identical expenditure of resources.

Corollary number two of this law says:

“The desire for more is automatic and instinctive and applies to all human needs, wants and desires.”

In other words, you always choose more rather than less. You always maximize your situation. If you are selling something and one person offers you $5 and another person offers you $6, if you are behaving normally, you will choose the offer of $6 rather than the $5. For you to accept a lesser amount rather than greater amount, some other value or consideration must be at work influencing your behaviour. All things being equal, the amount you will demand from the exchange of your time, money or resources will always be the very most that you can get for the very least that you can give.

This desire for more is another way of saying that everyone is inherently greedy. This is just a fact, a universal quality of human nature. In reality, the quality of greed has no value, positive or negative, inherent in it. Everyone is greedy in that everyone prefers more to less, all things being equal. People are just greedy for different things. Parents are greedy for their children in that they want the very best for them in life. Athletes are greedy in that they want to achieve the very most possible in their areas of competition. Everyone is greedy, everyone wants more.

Everyone is looking for ways to improve their conditions in some way. The only thing that stops people from acting in a greedy fashion is that they don’t see a way to get from where they are to where they want to go. All buying and selling decisions, and all negotiations, are based on this law of maximization. All salaries and wages are determined by it, including yours. Think continually about how you can add value to your work, every day, so that you represent maximum value to your company. Your customers are continually seeking for more in every purchase decision. They go where they feel that they are getting the best deal, all things considered. How could you increase the perceived value of dealing with you in the eyes of your customer?

 culled from BRIAN TRACY'S LAWS OF NEGOTIATION.

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