Double Up, Sir

Published: Sep 28 , 2012
Author: Robin Copland

There is more and more emphasis on the bottom line.  Negotiators are getting ever more ruthless in their search for a "better deal" and sometimes the old "win-win" mantra is lost in the stampede.

 

One of the tactics we see most often used by - and sometimes against - clients is the late introduction of a procurement specialist to a negotiation.  In many cases, this person is introduced rather shamefacedly by the regular negotiator; the excuse is given that they are just there to cast a paternal eye over proceedings and check that the deal is watertight.

 

I should perhaps explain at this point that this is not necessarily why they are there!  More often than not, they are there to extract the last percentile point of discount from the deal.  They are there, in other words, to expose the seller on probably the last issue that they want to be exposed on at that point - namely the price.

 

I recently heard a lovely story on this very topic.  A hotel manager had been in negotiation with a client about a conference and the deal had been done.  Two or three weeks before the conference was due to start, somebody from the client's procurement department phoned the hotel and suggested that there were a couple of points in the contract that needed tidied up and one of them (it turned out that it was the only one!) was the price.  He demanded a further five per cent discount so that the conference could be brought in "on budget".

 

The hotelier went back to the buyer with an "either - or" proposal. 

 

"I wasn't aware of the budget issue," he said, "when we discussed your conference.  If it is an issue for you, I can address it by having twenty of your more junior personnel double up in shared bedrooms.  Alternatively," he continued, "we can accommodate your delegates in single rooms, but that would have to be at the price I agreed with your colleague.  Which would you prefer?"

 

Needless to report that the original deal went through.

 

You can see how clever the hotelkeeper was.  Rather than haggle with the buyer and "split the difference", he gave alternatives, one of which exactly matched the buyer's stated need; the alternative, of course, was just the original deal, as previously agreed.  It was all about appearing to give the other side what they wanted - but very much on his terms.

Robin Copland - Partner, Scotwork UK LLP


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Robin Copland
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Who is Going to Pick the Fruit?

It’s amazing how many people go into negotiations with no clear idea about their bottom line. “We’ll see how it goes,” seems to be the rather naive thought and of course they leave themselves open to the risk of a really poor and unprofitable deal at the end of it. It is empowering to know your bottom line, especially when you have internal agreement at senior level. Think about it: the other side are aggressively demanding that you improve your terms, but you know that what they are asking for is beyond your bottom line.

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