Business Price

How To Negotiate on Price

Introduction

Negotiation is an interactive form of communication, in which two ore more parts that have a disagreement want to arrive to an understanding that solves a common problem, or reaches a common goal. Negotiation on price allows creating, maintaining or developing human or social relation, in general, but also a business, work or diplomatic relation. Negotiation on price doesn’t always follow the direction of an understanding. Often, they are lead for their side effects, as buying time, maintaining and improving relationships or stopping a conflict situation.

Step 1

The specialized literature presents three fundamental types of negotiation on price. There is the distributive negotiation, which goes for both winning and losing. It is the negotiation that defines a transaction in which it isn’t possible that one side wins, without the other one to lose. Any concession made to the partner is harming. The object of the negotiation on price will be an agreement that doesn’t consider the interests of the partner and it will good as long as it strikes more in the partner.

Step 2

The tactics and techniques used in the distributive negotiation are typical for solving conflict situations. Among the usual tactics of the distributive negotiation on price are: the polemic (systematic deviations of subject), the forced attack, the intimidation, the rhetorical means and disqualification (through attack on person).

Step 3

Another type of negation on price is the integrative negotiation, the kind of win-win situation, where the interests and aspiration of the partner are respected, even if they are against your own. It is based on mutual respect and toleration of the other one’s opinion.

Step 4

The rational negotiation is that in which the parts do not intend to make or obtain concessions, but to solve conflicts from an objective position. In order to have that kind of negotiation on price, the parts have to know exactly what the other one needs and to establish a full transparency, without dissimulating or being suspicious.

Step 5

In almost any kind of human interaction we apply a certain strategy. Nothing we do is without wanting to achieve something. To reaching a goal, we sometimes need strategies. There is a very important thing to know about different types of negotiations.

Tips

The premeditate tactic in a strategy of negotiation on price can be helpful most of the times. However, if our opponent has an impulsive reaction, we need to change our premade tactic and start to think what the best solution for the moment would be. Having a strategy made it is easier to maintain the control of the situation, take the initiative and winning the battle.

Sources and Citations

The best tactic in negotiation on price is the one of the false offer. It is unlikely that in this kind of negotiation none of the parts loses something. In that case acting is the best chance to win. There are situations where the buyer makes an offer to the seller that he cannot refuse, to eliminate the competition. Once he did that, he tries to do anything he can in order to modify the initial offer. In many occasions the seller is put in a situation where he can no longer refuse.

By Vlad Stanculescu, published at 02/28/2012
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