How can you determine your bargaining power in a negotiation?

1 Know your BATNA

Your BATNA, or best alternative to a negotiated agreement, is the most favorable option you have if the negotiation fails or you walk away. Knowing your BATNA can help you set your reservation point, or the minimum acceptable outcome, and avoid accepting a deal that is worse than your BATNA. For example, if you are a lighting designer and you have another offer from a different producer that pays more and gives you more creative freedom, you can use that as your BATNA and negotiate with confidence. If the current producer cannot match or exceed your BATNA, you can walk away without regret.

2 Assess the other party's BATNA

Just as you have a BATNA, so does the other party in the negotiation. By doing some research and asking questions, you can try to estimate their BATNA and their reservation point. This can help you determine how much leverage you have and how flexible they are. For example, if you are a performer and you know that the other party has a tight deadline and a limited budget, you can infer that their BATNA is not very attractive and that they need you more than you need them. This can give you more bargaining power and allow you to ask for more favorable terms.

3 Consider the sources of power

Bargaining power is not only determined by the BATNAs of the parties, but also by other sources of power that can influence the negotiation process and outcome. Expertise, relationships, and information are all common sources of power that can be used to one's advantage. For example, a director with a proven track record and a unique vision can use their expertise to negotiate for more resources and autonomy. Similarly, a technician with a strong network and a good reputation can use their relationships as a source of power to negotiate for more opportunities and referrals. Lastly, a designer with access to relevant data and insights can use their information as a source of power to negotiate for more compensation and recognition. Having knowledge, trust, and data can prove invaluable in any negotiation.

4 Use power wisely

Having bargaining power does not mean that you should be aggressive or exploitative. To the contrary, using your power wisely and ethically is essential to maintain the relationship with the other party, increase the chances of reaching an agreement, and create a positive reputation for yourself. To do so, you should communicate clearly and respectfully, by expressing your interests and needs, listening to the other party's perspective, and avoiding threats or ultimatums. Additionally, it's important to seek win-win solutions by exploring options, trading concessions, and finding common ground. Moreover, building trust and rapport is key by showing empathy and appreciation, acknowledging the other party's concerns, and maintaining a positive and professional tone. By following these tips when determining your bargaining power in a negotiation, you can use it effectively to achieve your desired outcomes in theatrical production.