Tips for Effective Negotiation
Negotiation is an art form that is often overlooked by lawyers and non-lawyers alike. Although it’s a vital part of our interaction with each other in society, the only people who seem to take the time to master effective negotiation are sales people.
If you’re trying to resolve an issue before you have to go to the county court, these negotiation tips may enable you to get what you want before you lodge proceedings. Similarly, if you are involved in litigation and want to settle before the final hearing, you are going to need to negotiate terms with the other side.
What Are You Negotiating On?
One way to think about the subject of your negotiation is to think of it as being a box with a number of items in it. Those items are the issues over which you need to negotiate. The box is the total package that you are bargaining over. If for example you’re negotiating over the price of an item, or over a debt, consider the things that you might be able to negotiate:- how much the debt actually is, i.e. does it include interest, are there any late payment charges involved, and is there any dispute about any part of the payment being made?
- when that payment should be made. What are your timescales for the payment? Do you need it all in one go or would you be wiling to accept installments?
- how the payment should be made. A cheque will take a few days to clear, and there is a risk that it may not be honoured, or that it will be cancelled. Would you accept BACS transfer or other wire transfer? If you accept cash, you must be willing to issue a receipt for the money.
- If there is an issue over the price, or the amount of the debt, would you be willing to reduce the amount (or concede on interest charges or late payment penalties) if they paid more quickly?
With each element (or item in your box) you need to understand how much each item is ‘worth’ both to you and to your opponent. For example, an extended period for payment is likely to be highly valuable to a business that is struggling with cash flow, which may not be your highest priority. Alternatively, if you are struggling with cash flow, you may consider that renegotiating the interest on the debt or reducing the debt is more advantageous to facilitate prompt payment.