Business Negotiations

Effective business negotiation is a core leadership and management skill. This is the ability to negotiate effectively in a wide range of business contexts, including dealmaking, employment discussions, corporate team building, labor/management talks, contracts, handling disputes, employee compensation, business acquisitions, vendor pricing and sales, real estate leases, and the fulfillment of contract obligations. Business negotiation is critical to be creative in any negotiation in a business setting. Business negotiation strategies include breaking the problem into smaller parts, considering unusual deal terms, and having your side brainstorm new ideas.

Leveraging the contrast effect is also a powerful tool in negotiations. You might ask for more than you realistically expect, accept rejection, and then shade your offer downward. Your counterpart is likely to find a reasonable offer even more appealing after rejecting an offer that’s out of the question. Additionally, offering several equivalent offers that aim higher than your counterpart is likely to accept will elicit reactions that can help you frame a subsequent set that, thanks in part to the contrast effect, are more likely to hit the mark.

Building a team is critical to negotiations in business. To prevent conflicts among diverse, strong-minded team members from overshadowing group goals, negotiation teams should spend at least twice as much time preparing for upcoming talks as they expect to spend at the table. Because the other side will be ready and willing to exploit any chinks in your team’s armor, it’s important to hash out your differences in advance.

Other business negotiation tips include curbing overconfidence, creating value in the negotiation, establishing a powerful BATNA, effective use of emotions at the bargaining table, caucusing, delineating your zone of possible agreement, and other skills geared toward an integrative bargaining outcome rather than a distributive, or haggling, bargaining outcome.

In addition, considering the ethical and legal repercussions of a deal to insure that it is a true win-win is the hallmark of every experienced business negotiator.

Articles include many business negotiation examples, and explore concepts such as creative dealmaking, renegotiating unfavorable deals, seeking advice from a negotiation opponent, identifying a solid BATNA and crafting draft agreements.

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Union Negotiations Show How to Bring Reluctant Parties to the Table

PON Staff   •  10/21/2021   •  Filed in Business Negotiations

union negotiations

On April 24, 2013, an eight-story building in Bangladesh known as Rana Plaza collapsed, killing 1,134 people, many of them low-wage garment workers who made goods for foreign companies. In the aftermath, Western retailers were widely criticized for failing to engage in international labor union negotiations and address hazardous conditions in the factories where their … Read More 

Contract Negotiations and Business Communication: How to Write an Iron-Clad Contract

PON Staff   •  10/19/2021   •  Filed in Business Negotiations

contract negotiations

In contract negotiations, writing a contract that both encapsulates the negotiated agreement but also incorporates future elements such as the business relationship and the sustainability of the agreement can be a daunting task for even the most experienced negotiators. Executives often leave the legal issues surrounding their deals to their attorneys. While this division of … Read More 

Business Negotiation Skills to Curb Your Overconfidence

PON Staff   •  10/14/2021   •  Filed in Business Negotiations

overconfidence

To avoid the pitfalls of overconfidence, you need a clear understanding of how overconfidence is likely to affect your judgments and decisions (and those of your counterparts) at the bargaining table. Fortunately, new research suggests exactly when to expect overconfidence and offers insight into how you can prevent it from getting you into trouble in … Read More 

Signing Bonus Negotiation 101

Katie Shonk   •  10/12/2021   •  Filed in Business Negotiations

Signing bonus negotiation

After engaging in a successful salary negotiation for a coveted job, most people are ready to shake hands and start sharing the good news with friends and family. But these days, there may be one more negotiation you should consider launching before saying yes: a signing bonus negotiation. … Read More 

4 Sales Negotiation Traps—and How to Overcome Them

Katie Shonk   •  10/05/2021   •  Filed in Business Negotiations

sales negotiation

Whether you’re planning to put your home up for sale, trying to unload excess merchandise, or searching for new clients, there’s a good chance you’ll make your next sales negotiation more challenging than it needs to be by falling into common cognitive traps. You can improve your sales negotiation skills by learning about four traps … Read More 

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