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. 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.
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. So if you believe your offer is fair, do not concede.
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 concession if it’s needed to keep the negotiation going.
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 will affect the other party’s emotional investment in the negotiation.
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 magic bullet for making effective concessions that move the negotiation in a positive direction. Before going into the negotiation, try to identify negotiables that meet the other party’s need and then prioritize those that are of low cost to you.
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!
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 sales team with world-class negotiation skills, contact us or click here for more information.