Making concessions is a key part of any negotiation. After all, it’s the difference between artfully exchanging value in a way that encourages a long-term partnership and standing there like a petulant toddler demanding the world without giving anything in return.
The world’s best negotiators treat concessions in a similar way that experienced chefs use condiments when preparing a meal: sparingly and with purpose. In doing so, they’re able to reach a far more favorable — and delectable — outcome. But when you concede either too much or too little, your outcome will likely be unpalatable for both parties: bland and unsatisfying, or so overwhelming that it grinds the entire process to a halt.
To help you hit that Goldilocks Zone of negotiation concessions, we’ve compiled the following list of 6 key guidelines. Let’s dig in:
1. When you give a concession, get one in return
If you find yourself in a deadlock and want to make a concession in the hopes of moving the negotiation forward, always make sure to receive one in return. RED BEAR Principle – Reciprocal Concessions: Never give something up without getting something of comparable value back. Failure to do this communicates that you’re willing to give value away for nothing; either because you aren’t confident in your case, or you feel that you owe your opponent. This sets a dangerous precedent for the negotiation going forward.
For example, in an enterprise renewal discussion, if a strategic customer pressures you to hold last year’s pricing despite a planned 8% increase, you might agree to limit the increase to 3% only if they commit to a two-year term, expand licenses to an additional business unit, or add a premium support package, clearly linking your discount to their expanded commercial commitment.
2. Do not make any concessions unless you have to
You don’t automatically owe the other party any favors, so don’t give them anything just for the sake of it! Doing so hurts your company’s self-interest and sends a confusing message to the other party.
If you believe your offer is fair, hold firm and rely on RED BEAR principles like Concede According to Plan and Set High Aspirations to guide when—and if—you should move.
For example, if a strategic supplier pushes for a 7% price increase citing “market conditions,” holding the line might mean calmly reiterating your data-backed ceiling of 3% and signaling you are prepared to reallocate volume to alternative sources rather than exceed that threshold.
3. Get the other party to give the first concession
In a negotiation, making concessions is less a quick draw and more a game of chicken. Rather than beating the other party to it, you’ll be in a far stronger position if they concede first.
That being said, in line with the previous guideline, always be prepared to make a strategic first-mover concession—grounded in how you manage information and understand your power—when it’s needed to keep the negotiation moving forward.
For example, in a complex three-year SaaS renewal with added security modules and expanded global licenses, waiting for the customer to first ask for a price reduction revealed their urgency to avoid re‑platforming costs and internal security audits, allowing the vendor to trade a modest discount for a longer term, faster signature, and a committed rollout to two additional business units.
4. How you concede is more important than what you concede
A great negotiator is, ultimately, a storyteller. You need to create a narrative for the other party that engages them, gets them on your side, and leaves them feeling richer for the experience. The difference between a great story and a mediocre one isn’t what transpires, but how. Just imagine if Darth Vader was revealed to be Luke Skywalker’s father in the first few scenes of A New Hope, or if Bruce Willis was revealed to be a ghost in the first few scenes of The Sixth Sense (SPOILER ALERT). The situation wouldn’t be any different, but the viewer would have a far blander experience of the films and, as a result, be less emotionally invested.
Similarly, how and when you make concessions—and how you communicate them—shapes the other party’s emotional investment in the negotiation and should align with Managing Information Skillfully across the Competitive, Collaborative, and Creative dimensions of RED BEAR’s execution model.
5. Concede elegant negotiables first
When you make concessions, first try to give up things that have high value to the other party, but which are low cost to you. These “elegant negotiables” are a practical way to apply Satisfy Needs Over Wants, because they address what the other party truly needs while costing you relatively little. They become a kind of “magic bullet” for Trading Value and making effective concessions that move the negotiation in a positive direction. Before going into the negotiation, identify negotiables that meet the other party’s needs, and then prioritize those that are of low cost to you.
For example, in an enterprise SaaS deal, instead of dropping price, you might first offer a 30-day pilot, executive QBRs, and an onboarding workshop at no extra cost—low internal cost to you, but high perceived value that helps the buyer justify moving forward on your original commercial terms.
6. Slow and reluctant beats quick and eager
Lastly, don’t be too hasty. If it becomes clear you arrived with predetermined concessions that you’re eager to get out of the way, then there’s a good chance the other party won’t feel it’s a genuine sacrifice on your part. This also undermines the organic, natural negotiation atmosphere needed to reach creative solutions. By slowing down and being visibly reluctant to concede, even a small concession will feel like a great victory to the other side.
Use this to your advantage by setting high aspirations from the start and pacing your concessions according to a clear, disciplined plan.
RED BEAR Negotiation Company is a global performance improvement firm dedicated to maximizing the profitability of the agreements negotiated with customers, suppliers, partners, and colleagues. If you’re interested in empowering your team with world-class negotiation skills, contact us or click here for more information.