I first learned about Roger Dawson when I read Weekend Millionaire’s Secrets to Investing in Real Estate, which he co-wrote with Mike Summey. I was extremely impressed with the honest, straight-forward strategy that the authors presented.
Dawson is a negotiating expert, and his insights really opened my eyes to the world of negotiating. My newfound interest lead me to read The Secrets of Power Negotiating.
I now regard it as one of the most valuable books I possess and a must-read for everyone. Even if you don’t like the idea of negotiating, you should at least know what tactics are being used on you almost every day.
A Change of Perspective
Before I read this book, I looked at the act of negotiating as being dirty. It brought to mind William H. Macy’s used-car salesman character in Fargo (one of my all-time favorite movies).
My attitude quickly turned around after Roger Dawson educated me about the art of negotiation. He immediately struck me a someone who had integrity and generally cared about other people (two traits that were incompatible with my pre-concieved notions of a negotiator.) I learned that negotiation in its highest form creates new value for all parties involved.
Instead of looking at negotiating as a necessary and unavoidable evil, I now see it a bit of an art form. A good negotiator wants to work with other good negotiators, just like a good athlete wants to compete against other good athletes.
A New Awareness
Like I said before: even if you don’t care about learning how to negotiate, everyone deserves to know what techniques are being used on you almost every day. I walked away with a whole new awareness. It was almost a bit embarrassing to know that I had been giving in to tactics my whole life up to that point!
Dawson calls his negotiating techniques “gambits.” In the book he shares many simple, yet valuable gambits that you can use every day. Here are just a few of my favorites:
When I read this gambit, I immediately realize it had been costing me money my whole life. To be nice to people, I used to always smile and nod at the first offer. According to Dawson, you should always flinch.
At first I thought this gambit was dishonest; but then I realized that pretending to like the first offer was dishonest. It might have been nicer, but it was less honest.
If you’re dealing with someone who knows how to negotiate, they’re expecting you to turn down the first offer. If you just smile and accept it, they’ll take advantage of the situation.
Always flinch. Give ’em a blank stare, maybe grit your teeth and look to the left as if you’re thinking “man that’s a lot of money” (it’s probably what you’re thinking anyway).
Anyone who’s ever bought a car or a mattress has had this gambit used on them. Remember the scene in Fargo? The salesman tells the customer that he has to go check with his supervisor to see if he’ll accept the offer. He walks into the supervisor’s office, and instead of talking about the deal they chit-chat about something totally unrelated.
The salesman had no intention of getting permission, but by acting like he did he defers responsibility to a higher authority. Now he’s on the customer’s side, and they can both complain about the grumpy supervisor.
Once again, this gambit doesn’t have to be dishonest. The lesson learned is to get a higher authority and remove them from the negotiating table. Maybe it’s your spouse, a business partner, or a boss.
You might be the kind of person who likes to do everything on your own, but in this case, it might be hurting you. If the other party knows that you’re the ultimate decision-maker, you have put yourself in a much weaker position.
Give Your Largest Concessions First
- Let’s say you’re negotiating to sell a car, your asking price is $5,000, and you’re willing to go down to $4,000.
- A potential buyer counteroffers at $3000, and in response, you say that $4,800 is the lowest you’ll go.
- The buyer offers again at $3500, so you come down to $4,400.
In this situation, you’ve put yourself in a weak negotiating position. Your first concession was $200 (your “lowest price”), and your second was $400. The potential buyer is thinking “hey, each time I counter, he comes down by bigger and bigger amounts!”
You start to lose credibility.
On the other hand, if you give up the $400 concession first, and then quickly tighten it up, the buyer will realize that you mean business.
This is just a small sample of the gold that’s in this book. Everyone should read it, especially if you consider yourself a business person.
Once you start to get the hang of it, negotiating can be a lot of fun!