Negotiation Strategy

Originally Posted by Thomas

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Pio - re: the comic book story - how does such a huge disparity in values occur? If you've already done your research and set your values, how does it come to pass that someone who does this for a living and is reputedly knowledgeable would be so far away from your estimates? Either you worked with two grossly different sets of value bases (rendering one invalid) or one of you didn't do quite enough homework. Either way, there was an information disparity between you and the dealer (which, truth be told is the case in every negotiation), and that leads me to wonder what he would really have been willing to pay, and why. After it was said and done, did you find out why he was willing to pay so much?
Never found out, and never asked. Figured he'd be pissed at me. He either made a mistake, or had a buyer I didn't know about, willing to pay even more. And really, is not a large part of most negotiations trying to take advantage of "information disparity" (usually between markets)? In fact, there's even a word for it. Arbitrage. And the only way to get these 1:1, informational arbitrage opportunities, are not to name your number first. You'll never get the other party to expose their initial position. Also, say it was me that had the wrong information. If I had given my number first, think of how much cash I would have left on the table!

Originally Posted by Piobaire

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Never found out, and never asked. Figured he'd be pissed at me. He either made a mistake, or had a buyer I didn't know about, willing to pay even more.

And really, is not a large part of most negotiations trying to take advantage of "information disparity" (usually between markets)? In fact, there's even a word for it. Arbitrage. And the only way to get these 1:1, informational arbitrage opportunities, are not to name your number first. You'll never get the other party to expose their initial position.

Also, say it was me that had the wrong information. If I had given my number first, think of how much cash I would have left on the table!

These are good points. You have changed my mind for now.

Originally Posted by Thomas

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These are good points. You have changed my mind for now.

well let me sway your opinion......one time i was haggling with a young man over a bag of marbles. i says hey fellah, ill give you 3.50, he says 3.25 and its yours. i says you drivez a hard bargain, but ill take it!

now what do you think?

Originally Posted by Thomas

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Name your price first. Generally, the opening positions predict the outcome.

I thought it was the opposite. Always let your opponent set the first anchor, then work from there. Why limit yourself by setting a price? If you name your price, they're only going to negotiate you down. If they name a price, you can work your way up, the middle point being higher then you would have gotten by negotiating down...

Originally Posted by West24

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well let me sway your opinion......one time i was haggling with a young man over a bag of marbles. i says hey fellah, ill give you 3.50, he says 3.25 and its yours. i says you drivez a hard bargain, but ill take it!

now what do you think?

The mind wobbles.

Originally Posted by antirabbit

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I never price off of retail, but mark up from what I paid or price off of what has sold recently on the board.
I really hate the marked down from retail, lets be honest most of us find these at discounters at very good prices, we are not retailers.

On thrifted items, I just shoot for a price that will help me aquire something else I desire. With that said, I only thrift items I want to wear, not to resell.

+1

not only does the marked down from retail not work, but the buyers on this forum are taking more risk by buying here (or ebay for that matter) then in the retail store.

In the retail store i have many advantages:

-I can return it, in most cases. (say if its mismarked)

-I can try it on, and find out very quickly if it was mismarked.

-Its current or past season (not from a few years ago or more in some cases)

-I can see the color in person.

I recently bought a few shirts on ebay. Very happy with the transaction, but come to find out the shirts were mistagged, the sleeves are an inch longer then advertised, so now i'm spending $25 more to fix that. The color is also a hair darker then what i imagined them to be based on the pictures.

So...I'm sure i'll put them to use, but i spent $25/ea more then i planned, and i'll wear them much less often then planned.

I offered ten bucks lower than the total retail price for three CDGxH&M shirts to a person on Sufu and they responded that it wasn't good enough, that my offer had to have been at LEAST a certain amount, and then (apparently) cut off communication. Was it that unreasonable?

Originally Posted by Nananine

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I offered ten bucks lower than the total retail price for three CDGxH&M shirts to a person on Sufu and they responded that it wasn't good enough, that my offer had to have been at LEAST a certain amount, and then (apparently) cut off communication. Was it that unreasonable?

Kidnap his loved ones and hold them for ransom.

I've also negotiated many settlements, and I prefer to have the other side give me their number first. The only time I name my number first is if I'm the plaintiff and the other side has a limit on their insurance policy. Then I just ask for the entire policy (assuming there are no assets worth going after).

More important than who goes first, IMO, is not to bid against yourself. You do not move from your number until the other side has moved from theirs.

Originally Posted by odoreater

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I've also negotiated many settlements, and I prefer to have the other side give me their number first. The only time I name my number first is if I'm the plaintiff and the other side has a limit on their insurance policy. Then I just ask for the entire policy (assuming there are no assets worth going after).

Bastard lawyer.

Anyone know good books on this stuff?

Originally Posted by GQgeek

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Bastard lawyer.


If some asshole runs over my client's decedant while driving drunk and kills him, you bet your ass that I'm going to go after every penny that he has. If that makes me a bastard, so be it...

Originally Posted by Master-Classter

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I thought it was the opposite. Always let your opponent set the first anchor, then work from there. Why limit yourself by setting a price? If you name your price, they're only going to negotiate you down. If they name a price, you can work your way up, the middle point being higher then you would have gotten by negotiating down...

I'm sure you've read where Pio's changed my thinking on this.

That said, your opening position is generally negotiable in a negotiation, and there's an expectation that you'll be giving ground as negotiations continue. Ideally in your preparation you've identified your opening position, your non-monetary requirements, your preferred outcome, your bargaining chips, and your indifference point. As long as you stay above your indifference point, then you've gotten value - but not necessarily maximized it.

generally its soft of like the white side going first in chess - there is a basic advantage in not being the one to state the price first, but it is very hard to avoid that as the seller.

Originally Posted by Thomas

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I'm sure you've read where Pio's changed my thinking on this. That said, your opening position is generally negotiable in a negotiation, and there's an expectation that you'll be giving ground as negotiations continue. Ideally in your preparation you've identified your opening position, your non-monetary requirements, your preferred outcome, your bargaining chips, and your indifference point. As long as you stay above your indifference point, then you've gotten value - but not necessarily maximized it.
Prep matters a bunch, but people often get caught up in it and wind up over prepping. Pay much more attention to your objective and long term goals. The most important thing is to listen to your counter party and understand their drivers - timeline, money, quality, future service, volume, etc. As you understand their needs, you can craft a proposal that maximizes what you both want.

Originally Posted by GQgeek

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Bastard lawyer. Anyone know good books on this stuff?
Im told this is a pretty pivotal work. Never read it myself http://www.amazon.com/Getting-Yes-Negotiating-Agreement-Without/dp/0140157352