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Edition I ● ISBN: 978-83-64845-50-5

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Table of Contents

Title Page

Colophon

Why do you need another book on negotiations?

There are many road signs...

Negotiations, Inc.

Manipulation – a bridge too far

Why do we negotiate?

Negotiations – the best business in the world

Ask and it will be given to you. A question worth 1200 zloty

Who should negotiate?

Different negotiating targets

Why are you afraid to bargain?

Negotiating is no conflict!

What is holding you?

Only the poor do not bargain

The anatomy and physiology of negotiations – 57 principles worth their weight in platinum

Preparing the ground

Negotiating foreplay

Main phase

Striking a bargain

A few tips at the end

Other tips and tricks

Negotiating aikido – how to defend yourself

Ethics and negotiating savoir-vivre

Dutko, how much did you negotiate?

Wise men on negotiating and exerting influence

Go on, leave!

Why do you need another book on negotiations?

Negotiating is no longer an unpopular subject. On the contrary, the more commercial our world is becoming, the more necessary it is to get our own way. Sometimes I even get the feeling that negotiating has become... one of physiological needs.

In order to live, you must confront your ideas and arguments against the ideas and arguments of other people, institutions, companies or organizations. If you fail to negotiate, your life will be heading towards vegetation; only plants take in silence what nature offers: sunrays, water and minerals. All healthy animals, starting from the paramecium, fight for their existence and its quality. Negotiating is also a part of this fight.

The point is that we are often unable to define our own needs, and that is why we lose a lot of energy, time and health to fight for trivial things unworthy of our attention or just for things we do not need. The whole trick is to know what you need and reject everything useless. A kind of zen.

There are many road signs...

You will be able to find a great many books, articles and courses on negotiating, since this is a popular subject. And it sells well. 30 or 40 zloty [1 zloty is about 0.3 US dollar] spent for a book or a couple hundred (or even thousands) invested in a good course will pay off many times in the form of negotiated future profits, right? Hence such great number of authors regarding the subject.

Yes, I will also make some money on this book. However, the decision to share my own experience and conclusions, and to put in order and ‘compact’ the know-how on negotiations lies deeper. At a certain time of my life I realized that while for me negotiating had always been something natural and positive, for hundreds of people that I have been meeting every year this is a field either unknown or knowingly disregarded. Even shameful – almost taboo-like. At the same time I noticed that those who under different reasons do not negotiate or do it wrong, more and more become aware that they would like to change this. Hence the decision to write “Go and Bargain!” which – I trust – will become an inspiration for wise, ethical and successful upgrading of your standards of living.

The uniqueness of this book boils down to a few points:

1. Addressed to everyone. After all, we negotiate everywhere: at home, at school (grades), at a university (subject credit), at work (raise, promotion), in business contacts (terms of cooperation), with our family (choosing a place to go on holiday), with our friends (whether we meet at their or our place) and so on. The subject of negotiations is omnipresent, yet still very often simplified and reduced to haggling at a market.

We exchange opinions even more often, however we do not realize that we are negotiating.

2. Advice that you find here is universal. This is a book on everyday negotiations, but if you are a police negotiator, you might find here some tips that will help you make a criminal stop pointing a gun at the hostage. Or perhaps you are a prime minister of our country? Having read this book, you will know how to make striking coal miners stop burning tires in front of the parliament. Who knows, maybe some piece of advice might prove useful even at war when you have to negotiate peace terms...

The majority of principles that I included in this book for common people might also be used in untypical and uncommon situations. And, of course, in business.

3. “Go and Bargain!” is based on experience, not on theory. It is nothing like numerous scientific publications or books on negotiating multi-million dollar contracts. While I was writing this book, I based mainly on the experience closest to me, since it was my own, and not on statistical research or laboratory made analysis and assumptions.

In this book you will find over 140 stories that actually happened, though I am certain that your mind will not be willing to believe in some of them. At the end I have enclosed a table that includes the amounts of money I have saved in the most interesting bargains mentioned in this book. Have a look at live numbers, and you will believe in the power of negotiating.

4. A compact collection of strategic information on negotiating. Knowledge of negotiations is scattered in thousands of books, websites and publications. I thought that a book where all crucial principles are brought together might be useful. And here it is.

Apart from thousands of ‘cases’ which you might read as a kind of an action-adventure book, you will also find descriptions of more and less popular techniques and strategies. Of course, many of them are widely known, have been broadly discussed in literature and will not be anything new for many readers. You have to remember though that ideas and strategies unknown to the majority are the most successful ones.

5. I base on my own experience in Poland (though I gained it worldwide). I have visited a few dozen of countries worldwide and had a chance to bargain in different situations in most of them. However, I have described them from the perspective of my Polish nature which – as I have noticed – is peculiar compared to representatives of other nationalities.

Of course, many principles are common irrespective of cultural and social differences, yet not every piece of advice that is great in the US, will be so for every reality and, what is more important, for our European mentality.

Negotiations, Inc.

According to Witold Doroszewski’s “Great Dictionary of the Polish Language”:

negotiation – sing. an obsolete term, nowadays more common as plur. meaning treaty, dialogue, talks. (Latin negotiato = engagement in something)

However, a more contemporary online version of the “Dictionary of the Polish Language” (www.sjp.pwn.pl) says:

negotiations

1. talks or dialogue between the representatives of two or more number of countries, institutions, organizations etc.

2. bargaining with a seller for a lower price or more profitable purchase terms.

Surely, you have the feeling that something is missing from these definitions. For example, a broader context or some synonyms. I do.

As far as I am concerned, negotiations are a part of widely-understood argumentation which aims at even partial convincing of the other party to our ideas and the other party’s accepting them without any reference to any particular world view or theory yet with correlation to specific actions (practical aspect). In plain English, what is the point in seller’s agreeing with us that the price for the cucumber should be lower if they refuse to charge nothing less?

We all have been negotiating since childhood. This has also been the case with myself when, being a little spoilt brat I was, I used to stamp my feet at the store every time and blackmail my parents into buying me a pack of colorful stickers, refusing to do my homework if they fail to do so. Or that I will take out the trash under one condition – that I get to play outside with my friend Bartek a little longer than the usual.

However, consciousness is the key. That is whether and to what degree all your decisions and actions are conscious, and to what degree they are a result of automatic and unconscious behavior. This is the condition whether you consciously and deliberately apply particular principles or techniques and therefore what results you achieve. After all, random actions provide random results.

As children, we do not have the full knowledge. Rather, we have our intuition and know models that we copy. Although... I am pretty sure that when I was quite young (6 or 7) and gave my grandmother’s gold watch to my friend in exchange for a box of led pellets, it was accompanied by not bad negotiations and emotions worthy of natural born businessmen who know exactly what they are doing. However, my parents begged to differ.

Being serious however, my first conscious thoughts on negotiating came only a few years later, and when I turned 18, I started to realize that negotiating is a part of the bigger picture which might be classified under a more general term which is ‘argumentation’ (which is anyway implied by the fact that without any proper arguments all negotiations lose their reason for being; yet we shall talk about this later on).

It was 1997 when I came across Schopenhauer’s “Eristic Dialectic: The Art of Winning an Argument”. In the Polish foreword to this tiny book, Tadeusz Kotarbiński wrote:

The object of Schopenhauer’s treatise consists in such tricks that are used in arguments by those, who at any cost – therefore even at the cost of truth and justice and proper reasoning – want to have it their way absolutely to make everyone believe that they are right. It is good to bear in mind all possible tricks in order to know what one might be exposed to in arguments with dishonest people.

That was the beginning of my interest in the communicative and especially eristic model of man’s functioning. Before however I realized the role that negotiating plays in our life, I first had to trip over some dishonest people that the professor quoted above refers to so nicely.

Manipulation – a bridge too far

Indeed, in my short life I have many times met people who violated the laws of logic yet thanks to cheap linguistic and eristic tricks were able to argue and successfully convince others to their sometimes ridiculous ‘reasoning’. I am not talking about politicians for whom this is daily bread or about priests who – like a limping individual using a cane – support their point with dogma while fighting reason. I am talking about manipulations – often unconscious ones – of ordinary people who must prove that they are right every single day. Often taking at the same time mental shortcuts.

One of such situations that I experienced during my course of studies was, coincidentally, colorful: while discussing mixing of colors in painting and the colors palette with my friend, I heard him saying:

‘Orange is the basic color’.

‘Nonsense!’ I replied. ‘Orange is a mixture of yellow and red’.

‘That’s crap!’ I heard his sophisticated reply. ‘I study at the Academy of Fine Arts so I know better than you and I’m sure I’m 100 percent right’.

So, I proposed a simple bet: if my friend was right (which he stated without a shadow of a doubt a moment earlier), I would give him 10 zloty which will be the easiest-made money in his entire life. Should I be right (which he, after all, excluded unquestionably), he would pay me 100 zloty. He refused to take the bet, I do not know why. Such a shame.

What does this above-mentioned story have to do with negotiating? Well, the fact that we had an argument on which of us was right. Then I realized that a discussion, a dispute or other forms of argument are simply a form of negotiating in themselves.

Let me provide another example from this period of my life: while I was in my third year of studies in Wrocław, I took part in an interesting additional class the object of which was rhetoric. However, not in its original sense of the word (the art of beautiful discourse), but in the sense of the ability to argument and convince. As a part of the semester assignment, I was given the following subject:

“Prove That Winter Is the Warmest Season of the Year”

In a single page of computer typescript, I included a series of arguments thanks to which I got the highest grade in my group:

- Only in winter the radiators are hot. They are cold in the summer, therefore winter is warmer.

- It is in winter that we put on our warmest clothes. In the summer we put on our lightest clothes, therefore summer is cooler.

- In winter, walking from outside where it is frosty into a room where it is hot, people tend to notice and appreciate warmth more often than in the summer. Warmth in winter is more noticeable and appreciated, which is a sign that winter is warmer.

- In winter comes Christmas – a time when relationships between people become warmer, and the number of kind words and gestures is the highest.

And all this stuff.

A young PhD graduate who was running the class asked me after the last lecture to stay ‘after class’. In an empty room she congratulated me on the accuracy of my arguments and asked whether I had ever considered applying for a PhD program after I get my MA, since having this skill will make it easy to defend a thesis and begin an academic career.

I was a little saddened by this offer, since all my arguments had been based on cheap associations and fallacies, and not on rightful logic. Not to mention the actual state.

I then realized that rhetoric, eristic and negotiations are more like Siamese triplets – they usually come in a pack.

I also understood that – with a pinch of distorted logic and devoid of ethics – this trio shall become in the hands of cruel people a tool for manipulation and exerting pressure. Later on, I had a chance to meet a few of such manipulators along the way. Appearing in public, they were able to delude from a few hundred up to a few thousand people – desperately afraid to use their brains – with great pleasure buying thoughts of strangers and using them as some kind of mental prosthesis. Experts on manipulation were able to bring their spectators almost in a kind of trance making them instantly run and buy their products: courses, coaching sessions, books or the so-called mentoring services. (I will get back to this subject once more in the context of using a time loop that is supposed to make the other person instantly make sometimes absurd decisions of purchase).

Anyway, when someone in my environment keeps using the words ‘coach’, ‘mentor’ or ‘mental trainer’ (especially in relation to people aged 30–40), I have allergies or even sometimes feel nauseated, since I think that in 9 out of 10 cases a more adequate word would be ‘manipulator’. It is seldom today that we can meet people who are truly mentors. I have heard a few times that I am somebody’s ‘mentor’. I was rather scared than happy, since usually ‘mentoring’ that I had the chance to observe would rather bring to mind sectarianism than inspiration or transfusion of wisdom.

Still: in the background of all these processes – whether ethical or unethical – lies just the art of argumentation, exerting pressure, persuading and convincing – mental negotiations of some sort. The more successful, the more consciously people using them apply a combination of rhetoric, eristic and linguistics.

I am quietly confident that manipulators shall keep on being trained by their foreign masters and will never reach for this book. I hope that this book will find its way to ethical and wise people who instead of beating their opponent at whatever the cost shall rather focus on negotiating as a balanced and worthwhile form of assertive communication and having their expectations met.

Surely, the word ‘zen’ appeared in the subtitle of this book for some reason.

Why do we negotiate?

If you gave a snort of contempt while reading the title of this chapter – chalk one up for me. This means that you have yet a lot to learn. If – Why? Obvious, to buy cheaper or sell higher! – crossed your mind, you probably do not see the range of opportunities and applications of negotiations, and therefore profits from the knowledge of rules.

A smaller or greater financial gain is just one of the most absolutely trivial aims (and reasons) of negotiating. However, there are many more such aims.

But first...

Negotiations – the best business in the world

Striving for financial freedom and security, many people wonder what they can make the most money on. Some look for a well-paid job, others have their own business and some try investing. Each of these ways, if it is followed in a well-considered and consequent way, may lead straight to its destination. However, each of them is only one path to your financial freedom, and as you may well know, it is not that easy to keep your balance on one leg only...

Focusing only on the issue of how to earn more?, you might lose from your sight the other model of accumulating capital which is much more easier, efficient and practically risk-free. It just requires you to develop certain simple habits and learn its basic rules.

To explain my point, let us suppose that you are now holding an actual phrase (made from Styrofoam or an XPS board) saying:

How to earn more?

Imagine yourself now putting the phrase in front of a mental mirror which is supposed to show its opposite. What do you see in the reflection?

If you look at the right angle, you should see the following phrase:

How to spend less?

After all, it is much more easier to hold the capital that you already have than to get a new one. You will have the help of the two wise sisters, Saving and Negotiating. As far as I am concerned, it is them that you can base your economic freedom on: should you even lose your job, lose in the stock market or go bankrupt, the skills of wise saving and negotiating will allow you to survive through even the toughest crisis.

Unfortunately, I know a lot of people who are convinced that only hard and well-paid job is the key to their financial capital. As a result, they work like a horse for 60–80 hours per week, earn a dozen or so thousand zloty per month and... stay poor. Being unable to either save or negotiate, they cannot manage their capital that is trickling through their fingers.

And will continue to do so. A table standing on one leg only (earnings) has to fall; should you however equip it with two more solid ones (saving and negotiating), it will become stable[1].

But wait! In the title of this subchapter I have suggested that I think negotiating is the best business in the world. Would you like to know why do I think so?

For the last dozen or so years, I have run various business activities. Of course, some of them turned out to be a complete disaster, just to mention selling used books when I was just learning the art of selling and made various mistakes. Other ideas hit the jackpot and would have allowed to gain a certain capital, but I became bored with them quite fast (e.g. production of photos on magnets and promotional matches on magnets – these ideas are still lying fallow, waiting for someone to buy them from me and make money on them). Some other business activities (editing, auditing, training and consulting services) are still active and are doing well.

Thanks to these business activities that I consider to be good I have been able to earn from 200 zloty (being the absolute minimum) up to 4.5 thousand zloty (maximum) for an hour of efficient work. On average this is however from 400 up to 1200 zloty for selling my expert knowledge on audits and trainings and offering my assistance to companies in order to improve their business efficiency.

Do you think that earning a few hundred zloty or a few thousand zloty for an hour of quite a satisfactory job is much?

If so, it might come as a surprise to you: none, even the most well-paid sideline, has ever given me such a rate of return on the time invested as even the most trivial and quickest negotiation. In order, however, to earn from 3 up to 4.5 thousand zloty for one appearance, not only did I have to devote as MUCH as 60 minutes of my life spent on a stage, but also provide during this time the value exceeding this price. This is the value I have obtained during a dozen or so years of gaining my knowledge and experience. Essentially, these seemingly impressive amounts are not rates for an hour of time devoted, but for years of experience and sharing them with others.

It would sometimes happen that just one minute of bargaining, one sentence spoken or written without any preparation would allow to save from a few dozen of zloty up to a few thousand even. Let us take, for instance, purchase of a car the initial price of which amounted to 22 thousand.

‘A little expensive, if you ask me, my budget is merely 20...’.

‘20.5 thousand and it’s yours for the taking!’

This dialogue lasted less than 12 seconds. Efficiently, 1.5 thousand gained in 12 seconds amounts to 7.5 thousand in one minute. It would thus turn out that an hourly rate for even such primitive negotiator as I was myself at that time would amount to 450 thousand zloty. To tell you the truth, I have never ever had the chance to earn as much for an hour of any job. Have you?

I know, I know – you must now be thinking: Dude! You’re counting this wrong! The fact that you managed to take 1.5 thousand from a price in a matter of seconds doesn’t mean that you managed to earn 450 thousand!

And you are absolutely right! Shooting a single bullet and hitting bull’s eye does not make this any rule. We should rather say that even a blind squirrel finds a nut once in a while, but it will starve and die eventually since it does not know where to look for more. Converting one minute’s profit into an hourly rate with this approach is just imagining things.

All I want for you is to take your negotiating thinking to a higher level thanks to this book. From single and incidental acts of negotiating I want you to make a kind of continuity and a rule. If you scale occasional bargains into something permanent, reoccurring and conscious, you will find that the amounts negotiated will start to add up to something of a sort of an hourly rate. A rate you will never obtain inmost legal businesses, let alone in the best-paid full-time job.

Therefore, let me say it once again:

Go and Bargain! This is the best business possible.

Anyway: even if from time to time you manage to knock down a few dozen or a few hundred zloty, you will soon find out that one minute of stress-free bargain could be worth an hour or a week of hard work – this book is packed with descriptions of such stories.

And once you have felt the magic of negotiating, I assure you that it will become an exciting sport and an addiction at the same time for you.

Ask and it will be given to you. A question worth 1200 zloty

The awareness of benefits coming from negotiating and lack of anxiety to bargain can pay off sometimes.

If I told you two pages ago that there is a simple, effortless, ethical and legal way for you to make 1200 zloty in one minute, you probably would screw up your eye and frown in skepticism. Having read the story of car purchase a moment ago, your forehead should now be a little smoother and you brows raised in wonder. Is this so?

If it is not the case, here is another example proving that sometimes in reply to the offer sent all you have to do is to present your counterargument, and such ‘miracles’ will happen.

In April 2014, my Akademia Internetu received an inquiry concerning the training on e-marketing. The prices of trainings we offer are moderately high (from 2 up to 5 thousand zloty per day), therefore not every company would be able to allow themselves such luxury. However, there are no obstacles to ask for a modification of such cost.

And so it happened. I received a very short inquiry which must have taken its author not more than one minute to write:

Hello, we are a very small company. The number of people attending the training would be max. 2. Could it be possible to make the training related expenses cheaper?

And so, earlier assumptions were verified and counter offer sent, which allowed the client to reduce the cost of two-days’ training by 1200 zloty:

For instance, if we’re taking a two-days’ training into consideration (the first day dedicated to the most important and most profitable e-marketing actions, while the second one only to e-mail marketing), I’d like to have it run by two different trainers, one probably from Wrocław and the other from somewhere near Warsaw. In this case, apart from the remuneration of the trainers, we must consider trip and accommodation-related expenses, so the cost I mentioned earlier is little flexible, unfortunately (however, I think that we might manage to achieve a 10% discount).

If the e-marketing part was only one of the modules and not a whole separate day of training however, the whole training might be run by just one person, and this will provide us with considerable savings. Depending on the date of the training and the availability of our trainers, this might be one of them, however I might give a lecture on this topic myself – in the latter case I can offer you a 15% (~525 zloty) discount in the case of 1-day’s training or a 20% (~1200 zloty) discount in the case of 2-days’ training.

As you can see, my client in one short e-mail made me answer her inquiry. In consequence, instead of 6500 zloty for a two-days’ training she received an offer for 5300. In other words, in just one minute she negotiated (therefore saved and earned) twelve green banknotes with a certain nice Polish king on them.

If, taking a walk one day, you came across twelve merry Jagiełłos[2] lying on the pavement, would you care to bend and take them in? I bet you would. And this is just the same amount (close to zero) of effort that everyday negotiations require from us!

Who should negotiate?

I am sure that you already know the answer: anyone! Anyone of us has been confronting other people in their lives. It is often that either we want something from others or they want something from us. Sometimes we are however unable to get an agreement on the ‘price’ for this ‘something’. It is then that we start our bargain – usually unconsciously and without any strategy whatsoever, which in more controversial or just hard situations might cost us a lot (not only of money).

Admit it, even once in your life, after the end of talks where you wanted to knock down something from the price, you silently realized: Fuck! I blew it... Now I’d have done it differently.

Time, as we know, is a good teacher; yet it might be too late for learning sometimes once bad decisions are made. Thus, this book is a time machine for you thanks to which you will obtain strategic knowledge on what might be coming; any knowledge gained ‘after’ is too little too late. (However, even for those that are always running late, reading this book might get them there on time).

Let us go back to the question who should negotiate? Of course, what first comes to mind is people who have arguments and disputes included in the nature of their job: politicians, soldiers, mediators, diplomats, attorneys, hired agents... Yet, there is also a whole circle of representatives that come in more common ‘segments’, as follows:

- Private individuals – it is from negotiating abilities that they possess that their personal capital depends on – and on this capital depends their freedom in decision-making and freedom and financial security in general, but also the standard of living of them and their family. The ability to ‘have their own way’ stays in close relation with the notion of ‘assertiveness’. This is the condition of whether we live the way we want to or the way others (family, employers, politicians, religious leaders and, finally, sellers and marketers who want to intensify our purchase decisions at any cost) want us to live.

- Buyers and sellers – this does not require any comment, does it?

- Small companies – because they are... small and every thousand zloty or extended due date of payment might have an effect on their liquidity and survival.

- Medium-sized companies – because their ability to invest and thus develop depends on their capital, dates and terms of cooperation with contractors and employees. Or else they drop to the third division.

- Large companies – since it is their obligation to generate profit for their employees and shareholders (this in particular concerns joint stock companies which pay out dividends). Moreover, large companies should negotiate... since their strength is greater in this scope (see: large chain of stores which firmly negotiate terms with their suppliers).

Incidentally, while we are talking about companies: sometimes people who do not run any business but are employed under a contract of employment, think that if someone is an employer or a member of the board of directors or is in some other high position, they are unconcerned with the problems of ordinary men. Yet, this might come to some as a huge surprise, but the problems of the ordinary people are actually the same problems that the great ones have; the difference lies merely in the scale or the way they are overcome.

As I mentioned, I have been running various business activities for a dozen or so years. One of them consists in intensive advising to other companies (i.e. auditing sales offers and trainings). I have worked with about 10 thousand entrepreneurs: tiny one-man businesses, but also stock-listed companies, greatest logistics operators, private universities, media, organizers of great business fairs, main energy conglomerates or internet tycoons (just to mention Allegro, KGHM, Gazoprojekt, DHL, Idea Bank, Poznan International Fair, Tauron, TVP, Oponeo, Business Centre Club...). Of course, I got to know some of them only superficially as a part of a one-off cooperation, others – profoundly during cooperation that lasted for even a few years.

One thing I can say: all these companies, irrespective of their size, popularity and the manner of management, profile, legal form or trade would be long gone from the face of the earth once they would stop their negotiations for just one moment. With suppliers and customers, clerks and competition, business partners and their own employees (or – what would be worse – with trade unions). Negotiations are one of the most important everyday elements in the operations of every – without any exception! – entrepreneur and enterprises (I am of course talking about the countries with free market economy or just seemingly free market economy – that is countries in the European Union). Even monopolies are coming to an end, oligopolies are unable to take the market for themselves for a longer time, and cartels... well – they operate often based on price fixing which is also a kind of pathology in negotiating terms.

In this book I have however focused on such strategies and forms of negotiating that – apart from companies – might also be used by you in your everyday reality or in your small or medium-sized company in order to boost its efficiency.

Let us however retain the proper order: before in the following chapter I answer the question how?, we must firstly realize that there are many aims to negotiating.

Different negotiating targets

I think the fact that money is not the only object of negotiations is already obvious to you. However, it is money that most frequently comes to our mind when we talk about bargains.

In the meantime, you can virtually negotiate anything. Below I included a list (incomplete of course) of the most popular objects and aims of negotiations.

Decreasing or increasing the price

This is surely the most common aim which however might be the result of various reasons. Usually, the argument is as follows: Because my budget is very limited. However, it is worth noticing that this reason not always goes along with the truth. Oh no, it almost never goes along with it! Buyers are lying in an attempt to try to make the seller reduce the price. You surely cannot get water out of a stone! – right?

I teach people participating in my sales training on how to dismiss the This is too expensive for me argument. Anyway, when I tell them not to believe fairy tales of the low budget, many of them are truly surprised that behind such phrases lies one of the most simple and oldest negotiating techniques.

Of course, upon hearing an individual crying oh come on, mister, this is way too expensive!, you can take the easy way out, take this at face value and agree for the discount. Or – worse – treat the customer as some kind of a beggar and drive them away. In this book you will find such stories that would be able to freeze alcohol in your veins, telling about incompetent sellers who lost clients worth a few dozen or even hundreds of thousand zloty, just judging by appearances or believing the message: You have to believe me, this is all I’ve got!

You can also – which is what I would recommend – assume a priori that the client is deliberately misleading you and try to find out their actual motivation and capability. Then you will be able to respond correctly, keep your opportunity, and at the same time not to be taken in by a more clever contractor.

Extra benefits

The wise will not fight for the price itself, but for the additional value. The buyer for the extra product, sample or service; the seller for the fastest decision of the client or the opportunity to sell something more (cross-selling).

Much clever clients (not meaning smart) have a certain key: they understand perfectly that the seller is unwilling to give away a part of their profit; they are more willing to sell the product at a regular price, adding something in return. This is something we refer to as extra. Or a bonus. Though economic experts would prefer the term added value, since it sounds more intelligent.

Imagine someone selling strawberries at the end of the day. Of course, you might say the following:

‘I will buy a kilo, but I can pay 8 zloty instead of 10. After all, you will soon be packing up anyway, so it would be a shame for those strawberries to go to waste’.

And I guess most sellers would go for it, since they would want to get rid of the fruit that would have to be thrown away anyhow. However, since we are able to predict the motivation behind the seller, we can play a different higher tune at the exact same string:

‘I can see you are packing up. I would buy some, but are you willing to sell one and a half kilo for the same price as one?’

If you asked for a 50% discount, I would not be so sure that the seller would agree to it so easily. If you however nicely ask for increasing the amount of products by half for the same price, and provide some nice arguments for your offer (which we will talk about in the chapter on principles of negotiating), I can bet you 5 zloty that you will get your 50% without any major sulking on the part of the seller. And maybe more.

Do you know any bank deposit or even a stock-listed company whose shares are able to provide such rate of return within minutes? I know none.

Due dates of payment

People buying on credit like to take it easy with their payments. In particular, entrepreneurs are glad to get their product and have the due payment postponed: in order to hold the money a little longer, to turn their capital a little longer, to multiply it and eventually then pay the supplier. I myself do not like and seldom turn to postponing my payments – both as the client and the contractor; however, I am aware that for many companies the so-called merchant discount is still the usual and perfectly common manner of settlements.

This is precisely why companies are equally willing to negotiate their discounts as well their due dates of payment: sellers would like them to be the shortest possible, buyers – the other way round. The other thing is that in the context of due dates cross-offers or conditional offers tend to appear, for example: Okay, you have 90 days to pay, provided that you buy not one ton but one and a half. Or in other words: Waiting for 45 days for the money is too long for us, but agreed – so be it. Should you however change your mind and pay upfront, you will get a 10% discount.

Did I mention that I do not like transactions with postponed payments? Well, I lied a little. Virtually a dozen or so days before me writing this, during the Warsaw Book Fair, I made an offer to one of the agents distributing my books. It was as follows: Do you take the “Efekt tygrysa?” 100 copies and a 50% commission, payment on the date most convenient for you. Unless you would rather have a 60% commission, but here are the terms: you take 150 copies and pay upfront.

Contractors generally like such nice dilemmas – since they can choose themselves if the greater value lies for them in the additional 10% of revenue or would they rather profit more on being able to turn the already held capital longer.

Extending the warranty

The issue is trivial – longer post-sales support service is one of the crucial elements of building the competitive advantage. If the equipment included in our offer is good, the risk that it will break in the third year of its use is only slightly higher than it being blown to bits during the first 24 months (unless a particular device is designed in such a way so as to be broken just one month following its standard warranty...).

Giving the customer a 10% discount – that just hurts; and if we operate in the low-margin products sector, such discount just would not do, since it would mean dumping which is selling below the cost of purchase. But think about this: does the fact that you do not want to or are unable to offer your client a discount mean that you have to refuse and – probably – lose them? Maybe there is something that you would be able to offer as a much cheaper alternative for you and still worth much more than the mentioned 10% discount for the client?

An extended warranty may be just the thing – for you this will be a small expense (assuming that the products you sell are of good quality and should not get broken so quickly). And this extra year of security that the client is provided with is still a very solid although maybe little measurable mental value. This is why, if the client is still hesitating, the argument: Oh very well, just to encourage you, let me offer the warranty extended by one year – may be the most important element that will tip the scales of this purchase decision.

The other thing is that all great players have long ago decided to assess this virtual value that the feeling of this additional security is. This might be seen even in the offers of large chains selling electronics which offer their clients various versions of ‘additional insurance’ on the product or purchase of an extension of the warranty period:

Source: amazon.com (accessed: 20.11.2017)

Additional support

Since we are already talking about the electronic equipment: for many buyers its installation or configuration is already a huge problem. Meanwhile, for the seller who is usually an expert in their profession, something that would cost the client 30 minutes of stress, is just a walk in the park. And if so, why not give the client this value for free, making it at the same time an additional low-cost negotiating leverage?

On the other hand: if it is you who is buying the equipment and you know that its installation will consume a lot of your time and energy, instead of mindlessly asking about the 10% discount, rather ask for the assistance in configuration or even basic training on using the device. I guarantee: you will gain more and the seller will lose less than this 10% which is just money.

Do you feel one of the principles of negotiation that might be learned from this example hanging in the air? The principle is: give the client something that would be of measurable value to them but no significant expense to you. Yet, we will talk about this later on.

Exclusiveness

This is a strong argument not only in marriage but in business as well. If you give a contractor your word that from now on only they shall have the right to... ahem... cooperate with you in some scope, you will mutually be able to make of such declaration a strong negotiating asset. Just be careful not to expose yourself to the Office of Fair Trading falling under a monopoly or the charge of price fixing; however this type of risk would rather concern major players than the medium or small ones.

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[1] In this book I have focused on negotiating which is one of the forms of saving. If you want to learn and develop a few other good habits of wise and efficient saving as well, be sure to have a look at this absolutely perfect and very practical blog of Michał Szafrański at JakOszczedzacPieniadze.pl.

[2] Władysław II Jagiełło – King of Poland (1386-1399) alongside his wife Jadwiga, and then sole King of Poland. His image is printed on a 100 zloty banknote.

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