Using Leverage Properly Increases Your Negotiation Strength

During a negotiation, applying leverage right, at the right time, can lead to the right outcome.

Leverage increases one’s ability to accomplish sought after outcomes, but applying leverage inaccurately can lead to unforeseen problems. As an example :

  1. Two individuals were negotiating over the phone, about the price of a property; both negotiators have equal negotiation skills.
  2. The perspective purchaser of the property, negotiator ‘A’, is negotiating on behalf of his client that wants the property to house her business. The other negotiator is the property owner, negotiator ‘B’.
  3. The two negotiators reach a point in the negotiation where price becomes an issue that can’t be bridged. They try to build rapport on other points, but when they get back to price, once again they find themselves at an impasse.
  4. Negotiator ‘A’, partially due to frustration exclaimed, ‘if you can’t meet my offer on price, we have nothing else to discuss. I’ll inform my client that she has to seek another property in which to house her business. This is my final offer, take it or leave it.’ (He delivered the offer with a sense of venom, and rude forcefulness injected into it.)
  5. Negotiator ‘B’ stated, ‘That being the case, the offer to sell the property to your client is withdrawn and this negotiation has concluded.’ Both negotiators slammed the phones into their cradles.
  6. Several days passed and finally negotiator ‘A’ called negotiator ‘B’, in an apologetic state, and informed him that he would like to purchase the property at the price negotiator ‘B’ had requested from the outset of the negotiation.
  7. Negotiator ‘B’ accepted the apology of negotiator ‘A’, and they consummated the deal several weeks later.

In the above example, negotiator ‘A’ tried to apply the leverage of ‘taking away’ the deal to get negotiator ‘B’ to acquiesce to his desires. Had he done so in a manner that was not fraught with male injected testosterone and a ‘take it or leave it’ attitude, his offer would have been viewed in a different light. By making the offer in the manner that he did, he almost cost his client a location that she wanted and caused the negotiation to ‘blow up’.

Sometimes you have to bend in the direction in which power pulls, in order to achieve the outcome you seek. When it comes to using leverage, make sure you understand the possible outcome of that which you seek to influence : and everything will be right with the world.

The Negotiation Tips Are:

  • Be it negotiating, or other aspects of your life, always seek to apply the ‘right’ amount of leverage. Too much leverage can be as bad as too little.
  • Leverage is like any other tool at your disposal when negotiating. Learn to use it wisely and you enhance its effectiveness.
  • One form of leverage is a lack of resistance. Determine when it’s wise not to resist in a negotiation.
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