Can You Push a Negotiation Too Far?

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Can You Push a Negotiation Too Far?

You can push a negotiation too far and its dangerous to do so. If you push a negotiation too far and you push the other side too hard and too fast, you risk not only losing the deal, but also isolating and distancing potential future business. Relationships are critical in the world of negotiating and knowing when to stop grinding is critical to maintaining and strengthening those relationships.

 

Negotiation is Intimate

Now, many old school negotiators will tell you that the person you’re dealing with is “just a supplier” or “just a buyer”. That’s nonsense. You cannot ever escape the interpersonal and intimate relationships that are formed between two people that have negotiated against each other. Each side is fighting for their team, but at the end of the game, you should be able to brush off the results of the game and go for a beer together because at the end of the day, the people that you are dealing with are people,….not machines,….not “just a supplier”,….not “just a buyer”.

There should hardly ever be cases where you walk away from a negotiation angry at the other person you’re negotiating with.

 

How Do You Know If You Push a Negotiation Too Far?

But how do you know when too far is too far? How do you know when you’ve pushed the other side as far as you can before damaging the relationship. A lot of this comes from time and experience and being in ongoing negotiations on a constant and consistent basis.

Unfortunately, a lot of this knowledge comes from pushing a few people too far, ruining relationships, and realizing that you screwed up. But learn from my mistakes, try not to make the same mistakes that I have.

 

The Signals People Give Off When You Push a Negotiation Too Far

I highly recommend you take a break to reevaluate where you are if you’re getting the following signals:

  • Concessions become tiny or non-existent.
  • The other person you’re dealing with becomes non-responsive.
  • After all the back and forth and negotiating, the other side finally says, “STOP! ENOUGH!”

It’s tough to know when to stop and when you’ve pushed someone too far. It’s especially hard to know when you’ve pushed too far when you’re dealing with a very experienced negotiator. Because maybe they are using the signals above to fake you into believing that you’ve pushed them too far. So what’s a person to do if they’re not getting the signals or they’re not getting any body language feedback, or they feel like they’re being faked out?

 

What If People Give Off No Signals

To help you not push a negotiation too far, you need to build the discipline of developing a negotiation strategy.

You never ever go into a negotiation without developing a proper negotiation matrix that determines your high/medium/low on the different items that are important to you. Let’s say you’re negotiating a new sale. First determine what’s important to our sales org.

What is most important to your organization? What is your strategy? Once you know that, it will help you put some riverbanks on either side of your negotiation so you know where you need to be.

For example, let’s say that what’s important to your sales organization is:

  • Guaranteed future growth;
  • Volume;
  • Annual contract value;
  • Total contract value;
  • Payment terms; and
  • Gross profit (in that order)

 

Develop a Negotiation Matrix

Then you should be developing a matrix that allows you to negotiate those items within certain boundaries. It should look something like this:

negotiation-matrix.png

Within this negotiation matrix, you should develop what your low (the lowest price, term, growth potential, etc.) , medium (the most likely price, term, growth potential, etc.), high (the best and highest price, term, growth potential, etc.) that you’re absolutely willing to accept.

The matrix is ordered in order of priority because what’s most important to you should be top of mind. Getting that negotiable item as high as you can is the most important thing you want to get out of this negotiation and you should be willing to accept a potentially lower result in the other items in order to get that item as high as you can.

These riverbanks/boundaries provide your negotiation with structure and discipline.

 

But How Do You Know When to Stop Pushing?

Now you’re thinking to yourself, but how in the world does this relate to what you were talking about earlier about knowing whether I have pushed a negotiation too far? Well, I’m glad you asked. Once you have a result that fits within the low and the high point of each negotiable items, you have a deal. You’ve achieved exactly what you set out to achieve. Once you’ve negotiated a deal that is within your boundaries, any grinding you do beyond that is ONLY about the optimization of the deal.

Once you’ve negotiated a deal that is within your boundaries on each item, you can stop and know that you’ve gotten a good deal. You’ve won. You have what you wanted to get. Stop before you push the other side too far and the deal falls apart.

 

Congratulate the Other Party

Now, once you have what you want and you’ve decided to stop. Don’t be a jerk about it. The other party needs to feel like they’ve won too. CONGRATULATE the other party!!!! Make them feel like they’ve won. Don’t be insincere about it, but sincerely say thank you and tell them that they negotiated well. Tell them that they were tough negotiators. Tell them that they were great to work with and you learned a lot from them. Because if the other party walks away without feeling good about the deal and feeling like they left money on the table, that will make your next negotiation with them so much more difficult because they’ll be out for blood.

 

You need to know when to stop grinding. Read the body language and verbal cues, develop a disciplined strategy, stay within your riverbanks/boundaries, and once you’re within your riverbanks, you can stop. Congratulate the other side and make them feel like they’ve won.