By Gian-Piero Furfaro
Most of you have heard the phrase, “The one who speaks first loses.” Does this mean an equally matched negotiation results in two salespeople locked in a room staring at each other for hours on end? There is truth to silence as an ally but there is more to consider than this alone.
So, what is the most important factor in negotiations?
Communication can either be verbal or non verbal. There has to be a statement of terms in any negotiation. Choice of words, pace, tone, medium and non-verbal clues such as body language all help deliver those terms. It’s important to focus on what you want to communicate and stay focused on objectives. Start by discovering, understanding and differentiating between your client’s needs versus their wants.
If you are going to use technology to communicate, you must understand how to use it. Can the receiving party accommodate your method of delivery? Are there technical guidelines to adhere to? Does the other party have access to a printer?
Be concise and remember that there is always a barrier of noise between yourself and the receiving party. This noise can be cultural differences, improper use of language, environmental noise, first impressions and the type of medium used. For example, one may prefer a telephone discussion to negotiate, because it prevents negative body language from being perceived while maintaining a level of closeness not achieved with email. That being said, a warm smile and a friendly handshake can also go a long way! The choice is not always yours but you can choose how to use communication effectively to your benefit.
Time management: Every listing representative should want more time and every co-operating representative should want as little time as possible to consider an offer. What about the timing of documents? A buyer representative would want an amendment to adjust price prior to firming a condition. Can a four-hour heated negotiation be completed in one hour with the same outcome? What effect does each scenario have on the quality of your client’s experience with you?
You can’t always pick your time but you can navigate time to strengthen your client’s position. For example, you may notice on a listing, “Seller requests 48 hours irrevocable.” There could be 100 reasons as to why this is valid. Do buyer representatives need to accommodate this request? No. This is a request adopted by listing representatives to put time on their side.
As a buyer representative, one strategy would be to advise the listing representative, “I may have an offer in the works. What time will your client(s) be available for presentation?” My strategy is simple. If the sellers are going to be in a place to receive offers at 7 pm, I give them until 8 pm to review the offer. The sellers do not have a fax machine or access to a printer? I’ll present in person.
Multiple offers are a different story. It’s much harder to negotiate with time in this scenario but time can be used differently. Your clients do not need to endure a long multiple-offer scenario. I have always prepped my clients to give their best offer out of the gate. This saves them time and money and improves their experience.
Understanding strengths and weakness: This element equally applies to the terms of the negotiations and your own personal abilities. By constructively understanding both you can find yourself with a successful deal. A truly successful negotiation involves both parties feeling they got what they set out to obtain. This is often referred to as the win/win negotiation. Be flexible on the weaker terms and focus on your primary objective. The point is your clients have to set goals early and decide what they can ultimately live with or without. Keep your course and know when to walk away. Your clients will stand a better chance getting what they set out to do and lessen their chances of experiencing remorse.
What is the most important factor in negotiations? It is control. Negotiations can be unpredictable like the weather. You can’t stop the rain from falling but a rain coat can stop the rain from getting you wet.
Gian-Piero Furfaro is the area manager/broker for Richmond Hill and Vaughan for Right At Home Realty. The brokerage employs more than 2,700 sales reps and has offices in Toronto, Oakville, Burlington/Hamilton, Mississauga, Richmond Hill, Vaughan, and Durham. www.rightathomerealty.com.