Research shows that most people just “wing it” when they get into a negotiation, and this often leads to a suboptimal result. Here are some things you need to prep before you negotiate:
*Do Your Research. For example, if you are going out to buy a car or a home, make sure that you do research ahead of time so you know what the market is like. If you are looking for a pay raise then try to find out what comparable jobs are paying. This will come in very handy when you are looking at alternatives.
*What is your Target Point? What do you want – ideally? What do you think is the right salary number for you or the right price for the house you are selling. Be realistic – but stretch some as well.
*What is your Reservation Point? This would be the minimum salary you would take or the lowest price you would sell the house for. Take some time to get very clear on this BEFORE you start negotiating.
*What is your BATNA? This is your Best Alternative To a Negotiated Agreement. Do you have a second job offer that you could take? Could you rent your house instead of selling it? Do you need to sell now? The stronger your BATNA then the stronger your bargaining position when you begin your negotiation. You may want to take some time to strengthen your BATNA before negotiating.
NOTE: You should typically NOT reveal your Reservation Point or your BATNA during a negotiation, as this could place you at a disadvantage. These should be kept private and are meant to help you guide your negotiation activity. Exceptions could include sharing your Reservation Point only if the negotiation is at an impasse and you are about to walk away. Or, if the other party is not moving in a positive direction and you have a surprisingly strong BATNA – such as another great job offer – then you may want to share it.
There are many resources that can assist you in becoming a better negotiator – including a great book: Getting To Yes.
We negotiate many things in our lives – including many “smaller” things than cars, houses, and salaries. Being fully prepared for these negotiations can pay off in big and small ways for you.
