How to reduce uncertainty in a negotiation

Uncertainty is the most difficult thing about negotiating - you NEVER know what the other person is going to do (if they are any good!).

Clearly if we could get uncertainty down to zero, so we knew exactly what they were going to do, we could optimise our approach and get a great result, as well having no stress - but that's never going to happen.

However we CAN massively reduce the amount of uncertainty by doing the following things. Similar to risk in project management, we can make problems less likely to happen, by research and preparation, and we can make them less serious, but having plans ready for what we'll do in each situation.

1

Research the market - what is the going rate, what are the typical tradables, and deals that get made (e.g. you can find out what houses have sold for here), and in particular, find out as much as you can about the other person and their company if you can. Google, linkedin, anyone you know who knows them.

2

Plan your walk away point in advance, so you KNOW the point at which you'll walk away, without having to do any thinking once you're in the negotiation.

3

Occasionally it's good to walk away from a deal - essential really - because it makes you stronger for next time. You KNOW you'll walk away if they don't agree to your worst acceptable outcome (lowest price if selling, highest if buying) - and knowing that you'll definitely walk if you have to, because yo've done it before, takes away another piece of uncertainty.

4

Make a list of tradeables that you want, that you can offer, that you think THEY will want and which they can probably offer easily. Put values against these - how much do you want them from the other person, and how reluctant would you be to give them to the other person? Now you don't have to be creative during the heat of the negotiation, you've got your 'pack of cards' ready to play either big ones or small ones as required - if they want a price concession then you can say "if you give me this then I can agree to it" so you have a clear and easy process to follow that will get you from where you start to where you'll finish.

5

Get them to open first - this takes away a big piece of uncertainty. If YOU open first you might put your foot in it and be too cheap (if selling) or offer to pay too much (if buying). Pass the uncertainty over to them!

6

Make your opening offer nice and wide - very low if buying, very high if selling. This means that when you do open, ideally second but maybe first if you have to, that you're very unlike to put your foot in it and be too cheap (if selling) or offer to pay too much (if buying).

7

Have a great Plan B, based on researching the market, so that you can walk away and still be fine. It makes you feel much stronger to know that you have other options, so the uncertainty about THIS deal is still there but you do have some certainty that whatever happens you'll be fine.

8

Tell yourself that it's OK to crumble (which means pay the price they want) so you won't / CAN'T lose the deal providing they are being reasonable - otherwise of course, you'll walk. But if something acceptable is already on the table youv'e got nothing to lose by trying to get a better deal than that, and crumbling if you have to. Yes there is uncertainty about whether they'll agree to what you want or whether they'll say no and you'll have to crumble, but it's not stressful uncertainty because you know what you'll do if they say no.

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Get some great deals!

CC

Much more information on Negotiating can be found in my courses on LinkedIn Learning and on Udemy:

LinkedIn Learning:

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Udemy Courses:

If you or your company have a subscription to Linkedin Learning, or if you have Linkedin Premium, then you already have free access to all my courses including these.?You can also do the free 28 day trial of linkedin learning and watch them during that period.

Alternatively if you don't have any of the above you can buy them as one-offs from udemy.com, often for less than $20 when there’s a sale on, and then you own the course for ever, so you can dip into it as often as you like, whenever you like.?