Negotiation is the art of letting other people have it your way
Contract Negotiation is fundamental to achieving not just a good deal, but in a lot of cases it is fundamental to getting a fair deal! You should never agree to the first version of any contract that is given to you to sign. Why? Because you can always do better… always!
This is an easy one. You should always negotiate a contract to get yourself a fairer or better deal. Remember that lawyers are engaged to represent the party that has engaged them, so when a lawyer drafts a contract it will have a drafting bias in favour of their client.
This means the contract will be skewed in favour of them. That’s why you need to negotiate each and every contract – to try and balance the contract back up.
Here are our top 10 tips when negotiating a contract:
- Negotiate with the right party – make sure you are negotiating with a person at the right level, someone who has power to make the decision, otherwise you could be wasting your time.
- Know your walkaway figure and what you would do if you can’t reach agreement – try to figure out the other party’s alternative as well, so that you can better understand what they want, what are their options. This is not as hard as you may think.
- Discern the difference between battle and wars – not all deal points have to be won. It is better to give and take to create longer term relationships.
- Understand the other side’s values – what drives them, what is important to them? If you know this it will be easier to draft an agreement that satisfies them (and obviously one that also satisfies you).
- You always want to allow the other party to win – i.e. set things up so that there are some points you know you are going to lose. It will help in the long run if the other side thinks they have won.
- Remember your personal ‘brand’ – people talk and the world is now smaller than it has ever been. Just have a look on LinkedIn for ‘degrees of separation’. This makes it easier for other people to find out what you are like and how you negotiate. So remember that when undertaking all your negotiations.
- Negotiation is a conversation – that’s all. The art is to come up with something mutually satisfying in a way that makes both side feel like they have won.
- Try to never bluff – because if someone finds out you have you will have a very hard time in the next negotiation.
- Never use words that incite, or increase ‘temperature’. Ignore their words if they use them on you.
- And lastly but importantly – be likeable. There’s no upside to being a jerk. Seriously. Business is built on relationships so it will nearly always be in your favour to be likeable and perceived as approachable.
Now armed with that, get out there and negotiate away, or we are happy to assist.