At RED BEAR, the principles of negotiation are not abstract theories; they are practical, repeatable behaviors that close the execution gap between what negotiators know and what they actually do at the table. We define negotiation as a deliberate, value-creating conversation driven by clear objectives, disciplined preparation, and consistent use of proven skills, regardless of the situation, counterpart, or pressure involved.
Our Situational Negotiation Skills methodology turns the principles of negotiation into a flexible framework that works across sales, procurement, and internal negotiations. Instead of a one-size-fits-all model, we focus on core principles that can be adapted to any context, helping teams protect margins, strengthen relationships, and achieve better outcomes deal after deal.
If you’re wondering, “How do I improve my negotiation skills?”, this article introduces the six principles of negotiation and outlines the negotiation skills experts use to maximize the value of agreements.
The key principles of negotiation for enterprise leaders center on creating measurable business value, protecting strategic interests, and building resilient relationships with counterparts at scale. For Directors and senior stakeholders, this means moving beyond ad‑hoc deal-making to a disciplined, repeatable approach that aligns negotiation objectives with corporate strategy, risk appetite, and governance requirements across complex, high‑value agreements.
To the untrained eye, it can be difficult to pinpoint what separates an expert negotiator from an average one, beyond the obvious dominant performance. The most common distinguishing factor is that many of the world’s best negotiators follow a core set of principles to prepare for and execute their negotiations.
In order
Describing your case in a succinct and compelling way helps to convey the value of your proposal or solution to its maximum potential.
Value is subjective, and the way you frame your case affects how the other party ultimately perceives its value. In order to effectively do so, you need to find that sweet spot of being brief and compelling.
Choose a few of your absolute best data points to anchor your value proposition or theme, and learn how to redirect the discussion towards your most appealing and powerful themes. Simply repeating your positioning theme naturally throughout the conversation helps demonstrate your conviction in the value of your ideas.
Average negotiators tend to skip over this Principle because they assume the other party already fully understands the value of their proposition or solution, which often isn’t the case. Additionally, including too much data or too many arguments to help the other party understand your value proposition can decrease the effectiveness of your positioning. Remember: your position must be brief, compelling, and repeatable.
Good positioning enables you to improve your chances of getting what you want and need from a negotiation by expanding the range of reason.
Translating this principle into action means deliberately shaping how you present and test your proposals. Use Make Demands to clearly state what you need and why it is justified, and apply Test and Summarize to check understanding, refine perceptions of legitimacy, and reinforce the value in your case. By consistently pairing these behaviors with solid standards, you position your case more persuasively and keep the discussion anchored in reason rather than pressure.
Those who ask for more tend to receive more. You don’t want the reason you underachieved in a negotiation to be that you set low aspirations. This is why it’s important to start high and concede strategically.
Reasonably high aspirations not only help you anchor the conversation to a higher perceived value proposition, but they also help to test the range of reason and reason of the other party.
Savvy negotiators will set high aspirations for all potential negotiables, such as:
Access to key people
Access to key resources and information (process control or pricing)
Agreement with your process, system, or approach
Schedule flexibility
Quality specifications
Favorable contract language
Broader warranties
Generous payment terms
Wrong Turn: An enterprise account executive anchors low, opening with a “fair” price to avoid scaring off a strategic prospect. Procurement quickly treats this as the ceiling, pushes for aggressive discounts, and demands added services at no extra cost. With no room left to move, the seller concedes on margin and scope, winning the deal but setting a weak commercial precedent for the relationship.
Right Turn: The same seller enters with a well-researched, ambitious target package, premium pricing tied to measurable business outcomes, phased deployment, and executive sponsorship. They clearly signal that this structure reflects the solution's value and risk profile and that any movement will entail reciprocal trade-offs. Procurement still negotiates, but now within a range shaped by the seller’s higher starting point and clear conditions for movement.
Make Demands: State high, value-based targets as firm expectations, not tentative wishes, and connect them to business impact and decision criteria.
Propose Conditionally: Tie any reductions or concessions to specific reciprocal commitments (volume, term, access, references, or scope), preserving the integrity of your high aspirations.
Establishing either too high or too low expectations can seriously hamper your ability to achieve a satisfactory outcome. Be reasonable but aim high. You are more likely to achieve a positive outcome and build a stronger relationship by reaching for the highest aspirations without being offensive or appearing to take advantage of your counterparty.
Aspirations can, and likely will be, lowered in a negotiation, but it’s extremely difficult to raise aspirations once they’ve been revealed.
For a large enterprise, protecting even 1–2% of price or cost in a major negotiation can translate into tens of millions in annual EBITDA. Treating aspirations and disciplined concessions as financial levers, not just “soft skills,” ensures every move at the table is tied directly to shareholder value and budget integrity.
Effective negotiators plan how they leverage, protect, and uncover information rather than do so spontaneously. There are three points of focus to manage information skillfully: uncovering information, leveraging information, and protecting information.
Uncover Information:
Uncover what the other party really needs to solve their problem by asking questions.
Generally, it’s more important to focus on getting information rather than sharing information.
Experts tend to ask 2.5 times more questions than average and do one third of the talking.
Leverage Information:
Provide information that works in your advantage.
Share information when it is most advantageous to do so.
Protect Information:
Sensitive information such as financial flexibility, internal deadlines, and free “extras” shouldn’t be shared at the wrong time.
Don’t share too much too early.
Anticipate the most difficult questions the other party may ask and prepare the appropriate answers ahead of time.
Prepare to answer disadvantageous questions without being lying or misleading.
Always operate within clear contractual, legal, and ethical boundaries.
This reinforces the RED BEAR “Execution in the Moment” behavior for information management: pausing to test assumptions, asking targeted questions, and deliberately choosing what to share and what to hold back. Participants see that effective information management is not a script, but an active, moment-by-moment choice that shapes the outcome of every negotiation move.
Expert negotiators can continually assess their level of power in a negotiation. This doesn’t mean the entire negotiation hinges on your personal level of power, but on your power relative to the other party’s.
Most people underestimate their power and are so focused on the pressures they face that they blind themselves to the other party's constraints. Power starts with personal conviction. You are as powerful as you believe you are.
Power is perception. If others perceive you to be powerful, then you have that power. The best way to enhance your power is to be very clear in communicating your expectations and boundaries.
Many people tend to rely too heavily on information as their primary source of power in a negotiation. There are many sources of power, and high performers recognize how to leverage all of them to improve their position.
Skilled negotiators are able to favorably influence the outcome of negotiation by:
Analyzing all factors affecting their power;
Assessing factors that increase or diminish the other party’s power
Managing all factors in a way that helps you execute the desired agreements.
In practice, you turn power into results by how you talk and what you ask for at the table:
Make Demands: Use your leverage to state clear, firm requirements instead of vague preferences. Skilled negotiators anchor expectations by saying what must be included (price, terms, protections) and calmly holding that line, while still leaving room to explore how those demands can be met.
Propose Conditionally: Trade on your power by linking your concessions to theirs. Instead of giving things away, frame moves as “if–then” proposals (e.g., “If you can commit to X volume, then we can move Y on price”), converting raw bargaining power into structured exchanges that move both sides toward agreement.
Savvy negotiators know how to uncover and address the other party’s fundamental concerns, interests, and motivations (needs) rather than simply reacting to specific and narrow demands (wants). However, to do so, you need excellent radar to distinguish wants from needs.
Wants: specific, measurable, and on the surface, or requirements that can be met in only one way. For example, a $1,500 delivery by Friday, or 500 units.
Needs: general, subjective, less measurable. For example, looking good to one’s manager, managing personal risk, or increasing market share.
Uncovering the other party’s needs requires good questioning and listening skills, and the patience to leave no stone unturned until you discover them. The key is to understand why the other wants versus what they want.
This is where behaviors like Ask Open Questions and Test and Summarize become essential. Open questions help you move past surface-level wants (“What solution are you looking for?”) to the underlying needs (“What problem are you trying to solve?”). Testing and summarizing what you hear (“So it sounds like your main concern is reducing risk, not just lowering price. Did I get that right?”) confirms you have accurately identified those needs and keeps both parties aligned on what truly matters.
Identifying the other party’s needs allows both parties to be more creative and leads to a true win-win agreement that meets the true needs of both parties and can be more satisfying in the long term.
By preparing value-based exchanges in advance, you can get “concession psychology” to work for you rather than against you.
Determine the cost of the concessions you may be asked for, as well as what the other party might give up in order to obtain them. To do so:
Set your targets high enough to support the necessary concessions.
Don’t give away things without asking for something in return.
Wrong Turn: Your customer says, “If you can get this 8% cheaper, I’ll sign this week.” You reply, “Let me see what I can do,” and come back with a 5% discount. You give up margin with no ask in return, no change in scope, and no protection on timing or volume. The customer learns that pressure yields price cuts, not trades.
Right Turn: The same customer asks for 8% off. You pause, revisit your plan, and reply, “We can explore a price adjustment if we also adjust how we work together.” Then you:
Make Planned Trades: “If we reduce the service bundle to the standard support tier and move to quarterly implementation reviews instead of monthly, I can offer a 3% price reduction.”
Propose Conditionally: “If you can commit to a 24‑month term and a minimum quarterly volume of 500 units, then I can extend an additional 2% discount.”
Protect Value with ‘If–Then’ Language: “If we keep the full service package and the current payment terms, then we’ll hold the current price. If you need price relief, then we’ll revisit scope, term length, or volume to make the economics work for both of us.”
Signal Limits Early: “We can’t move on price without adjusting something else. What are you most flexible on: scope, timing, or payment terms?”
<This approach turns concessions into intentional, pre-planned trades, tying every price movement to clear, reciprocal business value instead of automatic, one-way discounts.
Average negotiators tend to concede in one of two ways:
holding a position for too long, thus appearing inflexible and not negotiating in good faith, or
immediately collapsing to their lowest number when they get resistance from the other party, thus encouraging the other party to press for even more.
Explicitly scripting who will concede what, when, and under which triggers turns concession strategy into observable behaviors you can practice, debrief, and refine. In live negotiations, these preplanned moves prevent improvisation under pressure and ensure your team’s actions consistently align with your economic and relational objectives.
Ultimately, the real competitive advantage is not just knowing these negotiation principles, but applying them consistently to close the gap between strategy and execution. Organizations that plan rigorously yet negotiate reactively leave value on the table, erode margins, and weaken key relationships. By embedding these skills into everyday customer, supplier, and internal negotiations, leaders translate strategic intent into concrete outcomesprotecting price, expanding value, and reinforcing trust across the enterprise. This is how the execution gap shrinks: one well-prepared, principle-based negotiation at a time.
By following the above Principles, you will be able to elevate your negotiation skills and start getting more of what you want in your negotiations to the benefit of both parties. The ability to steer a negotiation with direct clarity is a hallmark of an expert negotiator, and by following these six principles, you’ll have built a sturdy foundation in order to do so.