NOVEMBER 2005 :: CONSUMER ED

From No to Yes
Understand the Power of Negotiation

By Karen Blumenthal
Staff Reporter of The Wall Street Journal

Do you want a car, or maybe a job? An extension on an assignment? A later curfew from your parents?

If so, chances are that asking nicely will only get you so far. You're probably going to have to negotiate, maybe giving up something to get what you really want.

In fact, negotiating is one of those basic skills that can come in handy in all kinds of situations, especially ones that involve big financial purchases. But doing it well takes some thought and practice. To give you a leg up, Consumer Ed asked negotiating experts to share their secrets. Here's some of their best advice:

Think ahead. Before you dive into your request, consider what you're offering that might be appealing to the other side. "Think, what am I bringing to their world?" says Jim Camp, an Ohio, negotiation coach and author of a book on negotiating. "Why should Yale take me? Why should mom and dad agree to this truck purchase?"

Mr. Camp cautions against trying to assume what the other side will think, noting that it's hard to really put yourself in someone else's shoes. But you can offer specific ways that the other side will benefit from your offer. If you're asking for a loan, be prepared to explain exactly how you'll repay it on time. If you want a car, remind your folks how you can help them out by driving your little sister to school or running errands.

Come prepared. Buying a big-ticket item? Nowadays, it's simple to research details about cars and their prices before you ever walk into an auto dealership to shop. If you are asking for a scholarship, you should know how much the school costs and how much it has to give away.

Olivia Hsu Decker, a San Francisco-area real-estate broker who specializes in multimillion-dollar houses, always studies why the sellers are selling. Are they relocating? Getting a divorce? And before buyers can make an offer, they need to study the market and neighborhood to understand a fair price. "Whatever the situation is, do your homework," she says. "You need to know everything about what you're buying."

Do your talking face-to-face. It might be easier to ask a date to homecoming through instant messenger, but the most productive discussions happen when both sides are in the same room. Ms. Decker says she tries to deliver offers to buy a house in person, rather than by fax or email, so she can watch the sellers' faces and gauge their reaction. Seeing the other side's reaction gives you more information, which can help you make a better case.

Bring questions and take notes. Arriving armed with the questions you need answered will keep the negotiations on track and show that you're serious about your quest. Mr. Camp recommends taking notes on the answers, partly because note-taking requires careful listening.

And, says Ms. Decker, "if you listen carefully, there's always some hint you can use."

Negotiations are a two-way street. Jeff Brundage, senior vice president of human resources for American Airlines, who has negotiated labor contracts on behalf of both unions and management, says that when people think about negotiation, "they think about winning at all costs or totally devastating the opponent." That may work sometimes, he says, but mostly it burns bridges, which "is probably the best way to limit your future options."

Instead, try to reach an agreement where both sides are reasonably satisfied. Go into the talks thinking: "I just want to win a little more than you do, but I want you to walk away with a good result," he says.

What's the alternative? Another tactic Mr. Brundage uses is to consider what the best alternative is if he can't reach a good agreement. For instance, if you can't convince your parents that you should have a car, you won't have a car at all.

"That causes you to be much more realistic about what you would find as an acceptable solution," he says. In other words, reaching an agreement to share a car or to have access to wheels for part of a week is much more attractive than no car at all.

Sometimes that means being creative. For instance, Ms. Decker, the real-estate broker, says that rather than lowering their price further, home sellers will sometimes include furniture in the home sale. Buyers may allow the seller to stay in the home rent-free for a month or two to make the sale more attractive.

"No" isn't always a final answer. Mr. Camp, the negotiation coach, sees "no" as a starting point, an indication that the other side sees something that he doesn't see. He suggests asking, "Now that you've said 'no,' where did I fall short?"

The answer might surprise you. A lot of times, he says, adults want to help a young person succeed and they may explain ways you could still get what you want or how to approach the situation differently the next time.

Be persistent. Don't be rude, but don't give up too easily, either. Keep the door open for further conversation. Mr. Camp says a young neighbor of his accidentally missed a key deadline for admission to an Ivy League university. When the admissions office told him he was too late and out of luck, he continued to ask whom he could talk to about the situation. Ultimately, he ended up talking with the university president-and winning admission.

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