The Absolute Unbreakable Laws of Negotiation – Brian Tracy (Series 3)

In our Negotiation Series so far, we have been learning how to be a good negotiator (series 1:http://emmanuelgreat.blogspot.com.ng/2016/04/the-absolute-unbreakable-laws-of.html

series2: https://emmanuelgreat.blogspot.com.ng/2016/0/the-absolute-unbreakable-laws-of.html).... to further continue our discussion let's look at the following laws...

* The Law of Time Preference:

“People prefer earlier to later in the satisfaction of a want, need or desire.”

Time is your most precious resource. It is like money.

Your supply is limited. Because you value your time and your life, you always want to achieve your goals with the smallest expenditure of time. You always negotiate to get what you want as fast as you can.

The first proposition of this law is:

“When given the choice between a reward today or the identical reward at some future time, in the absence of extenuating circumstances, you will prefer to have it earlier rather than later.”

If someone says to you, “I can give you $1,000 today or I can give you $1,000 tomorrow.” Which would you choose? The answer is obvious. If you have the choice, you will prefer it now rather than later. Why? There are two main reasons. First, you don’t know what might happen between today and tomorrow. And second, it is worth more to you today because you can do something with the money immediately. Both the predictability and the possible pleasure are greater if you get the money today.

The second proposition of this law says:

“Everyone is impatient to have more of what they want, faster and easier, because time has a value and sooner is more valuable than later.”

This natural impatience, based on time preference, is a key consideration in every negotiation. The more impatient the other person is for the negotiation to conclude, the better a deal you can get for yourself.

Time is the currency of the day. Everyone wants things faster and faster, and they will patronize anyone who offers them greater speed in satisfying their needs. How could you speed up your work and get more important things done faster? How could you serve your customers faster? How could you streamline your processes so you can give your customers more of what they what they want faster than your competitors? Speed is a value that customers will pay for in a negotiation. How could you use speed as a bargaining tool?

* The Law of Timing:

“Timing is everything in a negotiation.”

A negotiation can be made or unmade by the time at which it takes place. There is a too soon and a too late in every situation. Whenever possible, you should plan strategically and use the timing of the negotiation to your advantage. There is a better time to buy and a better time to sell in almost every case. And when your timing is right, you will always get a better deal than when it is not.

The first proposition of the Law of Timing is:

“The more urgent the need, the less effective the negotiator.”

If you are in a hurry to close a deal, your ability to negotiate well on your own behalf diminishes dramatically. If the other person is eager to make the deal, he or she is functioning under a disadvantage that you can exploit to your advantage.

For example, every company has sales targets for each month, each quarter and each year. Sales managers are tasked with hitting these numbers. They are dependent on them for their jobs, their incomes and their bonuses. Every salesperson has a sales quota for each month as well. Therefore, when you are buying any large ticket item, you will almost always get the best deal if you wait until the end of the month when the pressure is on to hit the targets.

The second proposition of the Law of Timing says:

“The person who allows himself to be rushed will get the worst of the bargain.”

Rushing or using time pressure is a common tactic in negotiating and you must be alert to other people trying to use it on you. People will often tell you that you have to make up your mind quickly or it will be too late. Whenever you hear this, you should take a deep breath and patiently ask questions to find out just how urgent the situation really is.

If someone insists that he needs an immediate decision, you can reply by saying, “If you must have an answer now, then the answer is ‘no’. But if I can take some time to think about it, the answer may be different.” On the other hand, you can use this tactic to your advantage by running out the clock so the other person has no time left and has to make a decision on your terms. Just don’t let someone else do it to you.

The third proposition of the Law of Timing says:

“You resolve eighty percent of the vital issues of any negotiation in the last twenty percent of the time allocated for the negotiation.”

Probably because of Parkinson’s Law, which says, “work expands to fill the time allotted for it,” most of the key issues in a negotiation get jammed into the final phase of the discussions. Up to this part of the negotiation, there seems to be a natural human tendency to procrastinate on the resolution of the most important issues.

What this means for you is that you must be patient in a negotiation. You must be prepared for the key issues to be resolved at the last minute. Setting a schedule and a deadline for a decision will help. If it should happen that the key issues are resolved earlier, you can be pleasantly surprised. But this is the exception, not the rule.

When you negotiate, set deadlines for the other party whenever possible. Remember the rule in sales, “No urgency, no sale!” You can always extend the deadline if the other party balks or disagrees.

Avoid deadlines for yourself whenever possible. Tell the other party that you are not going to make a decision today, no matter what is agreed to. Give yourself at least twenty-four hours to think in over before deciding. Sleep on it as a matter of course. You will be amazed at how much better you think when you have put some time between yourself and the decision.

* The Law of Terms:

The terms of payment can be more important than the price in a negotiation.

Many products, such as homes and cars, are sold more on the terms of payment and the interest rates than on the actual price or even the product itself. People usually buy the most expensive home they can qualify for. People buy the most expensive car they can afford in terms of monthly payments. Your ability to vary the terms can be the key to success in a negotiation.

The first proposition of the Law of Terms says:

“You can agree to almost any price if you can decide the terms.”

If you are negotiating and you really want to purchase the item, or sell it for that matter, and the price is the sticking point, shift the focus of your discussion to the terms and see if you can’t negotiate

The second proposition of the Law of Terms says:

“Never accept the first offer, no matter how good it sounds.”

Even if the first offer is everything you could possibly ask for, don’t accept it. Act a little disappointed. Ask for time to think it over. Ponder the offer carefully. Realize, that no matter how good the first offer is, it usually means that you can get an even better deal if you are patient.

The third proposition of this law says:

Never reject an offer out of hand, no matter how unacceptable it sounds when you first hear it.

A bad offer can be turned into a good deal for you if you can dictate the terms of payment. You can say, “That is an interesting suggestion. It is not quite what I had in mind. But let’s see if there is a way that we can make it work.”

Remember that you can get a better deal by controlling either the price or the terms. If the other party is determined to get the very best price possible, you can agree by suggesting terms that make the price acceptable.

Always look for ways to extend the actual payment of money as far into the future as possible. Any delay or deferment of payment, especially if you can arrange for no penalty for prepayment, increases the attractiveness of the deal by lowering the cash outlay in the present.

* The Law of Preparation:

Eighty percent or more of your success in any negotiation will be determined by how well you prepare in advance.

Action without planning is the cause of every failure. Negotiating without anticipating what the other party might want is the cause of just about every poor deal that you ever get. The very best negotiators are those who take the time to prepare the most thoroughly and to think through the situation completely before the negotiation begins.

The first proposition of this law says:

Facts are everything.

The devil is in the details. It is the details that trip you up every single time. Be sure to get the facts before you begin negotiating, especially if the subject is large or complicated, or both. Don’t be satisfied with the apparent facts or the supposed facts, or the obvious facts, or the hoped-for facts, or the assumed facts. Insist on the real facts, because the facts don’t lie.

Avoid the temptation to accept superficial answers or incomplete numbers. Don’t leap to conclusions. Avoid wishful thinking. Do your research, ask questions, listen carefully and take notes. This can make an extraordinary difference to the outcome.

The second proposition of the Law of Preparation says:

Do your homework; one small detail can be all you need to succeed in a negotiation.

Proposition number three of the Law of Preparation says:

Check your assumptions; incorrect assumptions lie at the root of most mistakes.

For example, one of the assumptions that almost everyone makes when going into a negotiation is that the other party wants to make a deal in the first place. This may not be the case at all. You need to test this assumption. Sometimes the other party has already decided to deal with someone else, or not to buy or sell at all. Perhaps he is just going through the motions of negotiating to see how good a deal he can get. Maybe someone else has offered to match the very best offer you can make. He may be negotiating without the authority or the ability to follow through on any deal you agree to. Be sure to check your assumptions before you invest too much time or emotion.

Always think on paper. Write down every single detail of the upcoming negotiation. Note every term and condition you can think of. Then, identify your assumptions and begin gathering information to verify or reject them.

Whenever possible, talk to someone else who has negotiated the same sort of deal with the same person. Find out what the other person is likely to want, and what he or she has agreed to in the past.

Be prepared!

* The Law of Authority:

You can only negotiate successfully with a person who has the authority to approve the terms and conditions you agree upon.

One of the most common of all negotiating ploys is called an “agent without authority.” This is a person who can negotiate with you but who is not authorized to make the final deal. No matter what is agreed upon, the agent without authority must check back with someone else before he can confirm the terms of the agreement.

The first proposition of this law is: 

You must determine in advance if the other party has the authority to make the deal.

The simplest way to do this is to ask the person if he or she is authorized to act for the company or client. If it turns out that he or she is not, you must be cautious about the positions you take and the concessions you offer.

The second proposition of this law is:

When dealing with someone who cannot make the final decision, you must represent yourself as being unable to make the final decision either.

Fight fire with fire. If the other person says that he cannot make the final decision, you tell him that you are in the same position. Anything you agree to will have to be ratified by someone else. This tactic levels the playing field and increases your flexibility in the case of an unacceptable counteroffer. Make every effort to find out who makes the final decision before you begin negotiating. Ask the person you are talking to if he or she is empowered to enter into an agreement based on what you discuss. If not, find out who is and attempt to speak to him or her directly.

When you cannot deal with the final decision-maker, do everything possible to find out exactly what he or she will find acceptable in making this decision. Be sure to mention that you will also have to get final approval before you can make an irrevocable decision to proceed. Keep your options open whenever possible.

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