Effective negotiating requires clear thinking and a constructive approach

It is necessary to have a clear understanding of what for you are the most important issues and at the same time what for you are less important. Try to identify aspects in the second category where the other side will be very happy to gain concessions. Give what is not so important for you, but is valuable for the other side.

To do this, you have to do the following:

• Check every item of what the other side wants. Ask how important items are and look for flexibility.

• Do not guess their opinions or motives – you could be wrong, or they won’t like your speculation.

• Note the other side’s answers, but don’t immediately say what you think.

• Avoid being forced into considering one issue alone; consider two or three at once – aim for an agreement to a package.

If there are big differences between two parties, you have a choice of these options: to accept, to reject, or to continue negotiating. If you decide to continue, then the options in the next round are:

• to make a new offer

• to seek a new offer from the other party

• to change the shape of the deal (vary the quantity or the quality, or bring in third parties)

• begin bargaining.

Your bargaining should be governed by three principles: be prepared, think about the whole package, and be constructive. In preparing you must identify the issues, and prepare your bargaining position. You need:

• an essential conditions list – issues where you cannot concede anything

• a concessions list – issues where you can make concessions

• to grade the concessions from the earliest to the most difficult, where you need most in return.

As for the package, you must look for agreement in principle on a broad front. When the time comes to compromise, each party will concede on one issue if they win a concession on another.

The final principle is to be positive and constructive. You should be fair and cooperative, even during difficult bargaining. This approach is most likely to move the negotiation towards a settlement that both sides feel is to their advantage.

b) Read the text again and identify the following:

1. How to respond to what the other side wants

2. Three ways to change the deal

3. Three actions to prepare for bargaining

Exercise 5 Read the following dialogues recorded during negotiations and translate them.

1. - Well, we’re happy to buy a machine if you can give us a good price.

- I’m sure we can. As you know, our prices are very competitive.

- Even so, I’m sure you can allow us a discount?

- Okay, well, a discount could be possible if you agree to pay for the shipping costs.

- That sounds Okay, if the discount is a good one.

- How about 4 per cent?

- 6 per cent would be better.

- I’m sorry we can’t manage that unless you pay for the installation.

- Okay, our engineers will take care of that.

- Okay then. So to confirm: a 6 per cent discount but you pay all the shipping and installation costs.

- That sounds all right.

2. - Well, I’d like to summarise – go over the points we’ve agreed on. Is that Okay?

- Yes, of course, go ahead.

- Well, the first point is that the property includes all the land pres­ently occupied by the station buildings and also the former car parks to the east of the station, the offices here to the west and the warehouses alongside the tracks. It does not include the present government-owned housing on the north side of the railway lines. The remaining land will be developed by Gibson Trust and later sold off separately. Is that an accurate summary?

- Yes, that’s right. It’s fine.

- Okay. So I think that’s fine then. Shall we stop there? I think we’ve gone as far as we can today. We just need to decide on our next meeting.

- Can we do that now? I mean sort out the next steps...

- Yes, okay.

3. - Well, as I understand it, in our next meeting we should examine development plans. Finally, we’ll draw up contracts. Then we’d need a little while to consider the contracts. So probably every­thing should be in place for signing contracts by the end of June. Does that sound reasonable?

- Yes, June, that should be okay. So when can we meet to look at development plans?

- Well, could it be April 10^th? Or any time that week?

- April 10^th would be okay. Same time 10 a.m.?

- Yes, that’s okay. Well, thanks for coming then. And I’m glad we’ve been able to make progress, to reach agreement, you know. It’s been very constructive, and we’ll send you a report.

- Very well. We’re also pleased to have reached this stage.

Exercise 6 Read three extracts and decide which type of negotiations each of them belongs to:

win-win negotiation – agreement-based negotiation;

independent advantage – negotiation in which each team thinks only about its own interests;

win-lose negotiation – negotiation in which one team wins and the other loses.

Extract 1

Lawyer: Yes, I understand what you are saying, but the facts are clear. The company was responsible for carrying all the safety checks. Those checks were not made.

Manager: That’s what you say …

Lawyer: There is evidence that safety practices were poor. You know that. I advise you to make a settlement, Mr. Cooper. If not, I think it could be worse for the company. You don’t want the press involved in this …

Extract 2.

First man: The price includes all the land and the buildings.

Second man: Yes. What about the payment terms? With better terms, you could accept a lower price?

First man: No, I think terms are not the problem. The issue is price, Mr. Ford. We have had several offers …

Extract 3.

Woman: Yes, what looks good here is the practical qualities of the building and the use of natural materials, stone, glass, wood. It’s very attractive.

Architect: I thought you’d like it. But we’d like to discuss some other possibilities, though. There are different options – we need to get things right – absolutely right.

Woman: Yes we need to talk about the time schedule, too …