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October 22, 2018

Negotiating Tip 7: Reward Power

The rewards you can offer to your opponent are only limited by your creativity. 

The Carrot and the Stick

I don't hear the phrase "carrot and the stick" as much as I used to.  I can't say that I know what is now being said in its place, but the principle still holds.  Dangling an incentive (the carrot) in front of another party (the mule) will typically prompt them to go in the direction we want them to go.

Good negotiators have long known that an incentive, a reward or a 'deal sweetener' can often put a deal together.  Any parent knows the drill.  The offer of a reward..."Eat your vegetables and you can have a cookie."  I won't comment upon the effectiveness of this strategy since our kids are much more skilled at negotiating than most of us. 

But don't discount the power of offering a reward when negotiating a good deal.  It not only is that 'deal sweetener' we mentioned before, it more importantly communicates that we recognize the perspective (needs, aspirations, concerns, pressure points) of our opponent.  It's often the key to a win-win result.

Setting aside our self-interest priorities for a moment to consider how our counterpart might feel is often a game changer.

When it comes to employing the power of rewards, creativity and 'out of the box' thinking is typically required.  Looking at a negotiation from your opponent's perspective can spawn proposals that might induce them to agree to a win-win deal. 

1.  I'll consider buying a larger quantity (reward...more volume) if you can give me a 10% discount.

2.  If you can do it for that price, I'll recommend you to my friends and even write a testimonial letter for your promotional use. (reward...more business)

3. I'd consider purchasing some of your other products (reward...more sales) if you can help me on this order.

4. Could you agree to this price if I pay cash? (reward....no credit card fees)

5. I can reduce my price on this order (reward) if you'll pick this up at our warehouse by Friday.

6. What can I do (ask them to suggest a reward) to get a better price on this?

You are likely more creative than me when it comes to identifying rewards.  Coming up with incentives becomes easier when you concentrate your efforts and thinking in that direction.  What are the possibilities in your negotiating circumstances?

What inexpensive thing could you give up (reward) that would convert your opponent's hesitancy into action?

Good negotiators recognize the trade-off possibilities when offering incentives or rewards.  Recognizing the perspectives of others always proves beneficial as we KEEP Negotiating.

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