What is Distributive Bargaining?
Distributive bargaining involves haggling over a fixed amount of value—that is, slicing up the pie.
Wise negotiators recognize the value of both collaborating and competing at the bargaining table. They look for ways to increase the pie of value for all parties, often by identifying differences across issues and making tradeoffs. And they also rely on distributive bargaining strategies to try to claim as much of that larger pie for themselves.
People often think that distributive bargaining strategies require adversarial bargaining, such as making tough demands, threats, or bluffs. But in fact, the most effective distributive bargaining strategies require you to set aside plenty of time before your negotiation to engage in clear-eyed preparation.
In particular, negotiators should determine their best alternative to a negotiated agreement, or BATNA—what they’ll do if they don’t achieve their goals in the current negotiation. A job seeker might decide to pursue other job openings, for example. Negotiators also need to assess their reservation point or walk away point—the figure at which they’re indifferent between accepting the deal they negotiated and instead of turning to their BATNA.
Additionally, to help determine the most you’ll be able to get in a distributive bargaining situation, take some time to research the other party’s likely BATNA and reservation point.
Then, armed with a sense of each party’s reservation point and BATNA, you should be able to determine if a zone of possible agreement, or ZOPA, exists in your distributive bargaining. The ZOPA is the range of all possible deals that both parties would accept. Your reservation point will be at one end of the ZOPA, and the other party’s reservation point will be at the other.
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The following items are tagged distributive bargaining: