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December 17, 2018

Negotiating Tip 56: Structuring The First Offer

Ambitious, but discussable!

Setting Structure

Perhaps the most challenging thing facing those who are about to negotiate something is how to structure that first offer, that initial proposal or their starting position.  While each situation is unique and hard and fast rules can't be adopted, there are some guidelines that could make us more comfortable and effective in this regard.

Perhaps the best description of how to structure an initial offer was shared by Dr. Margaret Neale of Stanford University.  She made it simple by saying, "Initial offers should be ambitious, but discussable."

Be Ambitious

You never get anything you don't ask for, so go for it.  Be bold, be optimistic, but don't go overboard.  There's a tipping point as to how aggressive you should be.  A ridiculous offer will not only be rejected, but it can negatively affect future negotiations.  If you have difficulty determining if your initial offer is too aggressive, and you still want to present it, at least communicate it in a softer way that says you have no intent to insult. 

"Fred, I'm not sure if I'm on the right track here, but I was thinking that I'd need at least $______ for this to make sense for me." While that proposal might be aggressive, the way it was shared almost guarantees that the negotiations will continue on a cordial, positive basis.

Now for the discussable.  

That's a great word.  Please consider adopting it.  See if you agree with me on the impact of word choice.  If we say, "It's negotiable.", our opponent assumes we'll make concessions and probably major concessions.  If on the other hand, we say,  "It's discussable.", our opponent merely knows we'll keep talking without that implication of major concessions.  

It also hints that we will be looking for trade-offs - something back from them - as part of any continued bargaining.  Perhaps I'm reading too much into the difference between "negotiable" and "discussable", but I think I'm right.

In closing, let me share that this might provide a great response to our opponent when they respond to our proposal by asking,  "Is that price/proposal negotiable?"  

Instead of saying yes or no, simply say, "Well, I can only say it's discussable."  

That measured response will put you, a good negotiator, in a great position as you KEEP Negotiating.

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