Don’t know when to cut your losses and leave the negotiating table? Look for these telltale signs.
There are obvious reasons to break off negotiations: For example, the other side’s last best offer doesn’t cut it, you find a better alternative, or you uncover something seriously unsavory about your opponent. Businesspeople favor and understand these sorts of objective analyses.
There are also subtler, more subjective reasons to pull the plug. If you’re the type of negotiator who takes pride in making the unworkable work, take special heed of the following pitfalls to avoid:
Your opponent is just too difficult. You learn a lot about how smart, decent and aggressive someone is by how he or she negotiates. If you don’t like what you see and hear when you’re bargaining, chances are it’ll only get worse once you’re in business together. After all, if negotiation is the courtship, then closing is the marriage. You don’t have to love, like or even respect everyone you deal with-especially if it’s a one-shot deal. But if you find this person an insufferable, time-wasting nuisance at the bargaining table, remember: It’s only a preview of coming attractions.
Transactional costs are too high. You make what you think is a simple deal. Then the “professionals” get involved . . . and nothing is simple anymore. There are legions of lawyers, accountants, bankers, brokers, appraisers, consultants and the like who peddle all kinds of services to would-be deal-makers. At their best, they can be critical to your success. They can also bleed your deal dry with contingencies, complications, fees and commissions if you’re not careful. Choosing wisely when you hire helps. So does getting a second opinion. Above all, ride herd. If these expenses become disproportionate to the size of your deal, you’ll end up hating yourself in the morning.
You need to teach someone a lesson. Frankly, I don’t see this very often, but I wish I did. There are certain deal-makers who are a blight on your business community. You know who they are. The next time they get cute, make yourself understood, if you can. Denying them the deal they want is exactly the kind of operant conditioning that even psychologist B.F. Skinner would applaud. So rejoice: You’re doing a public service.
Your gut tells you to walk away. I like the following definition of intuition: knowing without knowing why you know. I was once waiting to be interviewed by a potential employer. As we shook hands for the very first time, I heard this little voice in my head: “You will learn to hate this man.” As I left his office, I had no doubt that he was twisted. Later, I learned that he was a screamer who had chewed through 16 assistants in less than a year. Some potential business associates carry a dark cloud around them. If your gut says get out, listen to it and be grateful. After all, everyone knows things they don’t know why they know.