Page 85 - 2

P RINCIPLES OF N EGOTIA TION

good example: I put an ad in the paper to sell my late-model
Porsche. It’s in great shape, nice year, with low mileage, and with a
price of $30,000. It’s a great price and a fair deal. You call me up
and say I’ll give you $25,000 for the Porsche. And I immediately
say, “You have a deal.” You just bought a $30,000 automobile for
$25,000. But are you happy? No! Because, I accepted your offer so
fast, you feel that you could have bought it for $20,000. This was a
bad negotiation because the buyer isn’t happy. If he can, he may try
to find a way to back out. The same is true in negotiating over
real estate.
Now take the reverse scenario. I put an ad in the paper to sell the
same Porsche for $30,000, but this time you phone me and offer
$20,000. And I say, “No, the price is $27,000.” And you immediately
reply with, “Okay, I’ll give you the $27,000.” Now the question is,
am I happy? No! Because you went so fast from $20,000 to $27,000.
If I had stuck to my guns you probably would have gone a little higher
and paid the $30,000. I got what I wanted, and you got the Porsche
for what you were willing to pay, yet neither of us are happy because
we didn’t spend enough time going through the bargaining process.
In a successful negotiation, I have to convince you, the buyer, that
you got it for the cheapest price. And you have to convince me that I
sold it for the highest price, so that I feel I got the most out of the
transaction. All this takes time, haggling, arguing, and discussing to
accomplish. It takes extended negotiation.
So if you are negotiating over a piece of property, go through the
motions, even though you might already be satisfied with the price
and terms. Because unless the other party has satisfied his ego, he is
not going to make the deal, or he is going find a reason not to close
on the deal. The other party has to be convinced he is making a good
deal. The “invested time philosophy” that I discuss in the next sec-
tion also involves increasing the amount of time spent in pursuit of a
final agreement.

63