Blog | Entrepreneurship

Surefire Steps for Successful Negotiation (in Business and Relationships)

Be a sophisticated investor by using the right tactics at the right time; you just may end up with everything your heart desires

Summary

• To be a sophisticated investor, one needs to know how to negotiate to win

• Knowing how to negotiate will help in both your business and personal relationships

• There is an art to successful negotiation; start by doing your homework

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If you're going to be financially free, you need to be a sophisticated investor. And to do that, it's imperative that you master the art of negotiation. Knowing what you want and how to push for it is an art; one that takes time to master.

Here are some tips to get started.

The art of successful negotiation

Let’s start with three key tips on negotiations that everyone can put into play to both get what they want and play to their natural strengths.

1. Do your homework

   When it comes to negotiations, nothing tempers emotion more than a well-reasoned, fact-based argument. No matter how much someone wants to win a negotiation, it is incredibly hard to argue against cold, hard facts. So, it's very important to do your homework before you walk into a meeting or make any compromises.

   Talking about a real estate deal? Spend more time than you think you need to, to better understand the market, the property, the opportunities, and the angles than the seller. Have your numbers and be prepared to back them up with research.
   Buying a business or investing in one? Spend the time required pouring over the financials to see what others might miss.
   Taking the time to do your homework not only disarms your opponent but also gives you the peace of mind to stick to your number when push comes to shove. If you have the information you need on hand, you can be confident in what you’re asking.

2. Don't take no for an answer

   Because beginning investors are prone to pragmatism, it can be easy — even when we have a solid case — to take no for an answer. This doesn't mean we don't get anything…but it does mean we often get less.

   If the person you're negotiating with pushes back with a “no,” be prepared to hold your ground. This should be much easier to do if you've done step number one above and have your research in hand to back up what you're asking for.
   The trick here is to not ask for the moon, but to stick to what you know to be the right ask from the get go — and to not back down.

3. Be prepared to walk away

   We live in a world that can sometimes feel stacked against beginning investors. So, it’s easy to feel like the world is one filled with scarcity rather than opportunity. Given this, it’s tempting to accept less rather than to lose out entirely on a good deal.

   But here's the thing: In the long run, giving into a bad deal now only compounds your losses in the future. Rather, be ready to cut your losses and move on to another good deal if reasoned negotiations go south.
   The reality is there are plenty of good deals out there, and you will find something else that works tomorrow if you don't waste your time, and capital, on a bad deal today.

Successful negotiating with your life partner’s support

Now, let’s turn our attention to an applicable situation that hits closer to home — without even realizing it, you probably negotiate with your spouse or life partner every single day of your life.

As with any partnership, marriage is all about balancing your spouse’s needs with your own. And oftentimes, successfully navigating that means becoming a talented negotiator.

So how do you start something new (like investing or entrepreneurship) if your number-one partner isn’t interested? That’s the million-dollar question.

Here are four clear options for people facing this dilemma (while using investing in the following examples, the same concept applies to anyone seeking to start any business new venture):

1. Invest with your partner as a team.

   As the saying goes, two heads are better than one. That makes this option the most ideal. Investing involves an array of talents, and often couples who work together uncover talents they never knew they had. Learning a new skill together can be a wonderful opportunity for growth, and making joint decisions can really solidify your bond. Plus, you’ll be spending more time together as you work on your investments. So how do you broach this subject with your partner for the most effective outcome? Follow the steps outlined above, starting with doing your homework long before this conversation takes place — the more questions you can confidently answer, the more likely your partner is to have an open mind about continuing the conversation.

2. Invest on your own— but with your partner’s support.

   Still can’t get them to budge and join you? Then, see step number two above: don’t take no for an answer. The next best thing would be to have the support of your partner (so you aren’t fighting an uphill battle), even if they’re not actively involved in the process. Some couples who fall into this category may not stay there — once the money starts rolling in, the partner’s interest level perks up and he no longer wants to remain a passive bystander. If this happens, you morph into option one! But even if it doesn’t, this isn’t a bad place to be.

3. Invest on your own— without your partner’s support.

   Ok, sometimes you have to know when to walk away and this is one of those times. Let’s not sugar coat it: This is a very tough position to be in. You’re not only stepping into a whole new world, but you’re doing so without the support of your life partner. Again, once you succeed and have positive results, your spouse may turn around and become your biggest cheerleader. But if not, that’s OK too. People in this situation often turn to other investors for support, and you can find a tribe of like-minded people by joining investment groups. Sometimes, being surrounded by others with similar goals and ambitions is all the support you need.

4. Don’t invest.

   Oftentimes, however, this is the only option, as becoming a solo investor may have negative relationship ramifications of option three. If you’re here, try a different negotiation strategy at a later date to see if your partner will come around — sometimes, timing is everything.

Getting them to say yes

As just mentioned, timing is everything. So, whenever possible, include your spouse or partner in the process early on (after you’ve done some foundational homework). This may start as simply as drawing his attention to a newspaper article about the trends of your local real estate market. Or break out the board game CASHFLOW to help illustrate how rental income could change your financial future. You could also start a candid conversation about money, and ask questions about his relationship to it (read more about this in the book Rich Woman).

Ultimately, you’ll need to tailor your approach to your partner’s personality of course — the better you know your “opponent,” the more likely you are to get what you want out of negotiations. For instance, it helps to anticipate their reactions and/or objections so that you have a thoughtful, confident response prepared. No matter which route you choose, more communication, not less, has been the key for many couples in the midst of negotiations. Good luck!