In most cases, you will be required to negotiate before reaching a business agreement. Over the years, there have been a number of books on negotiating tactics, though most of these tactics are ineffective. For instance, there are negotiation tactics that are devious and most likely to fail – like insisting on negotiating items that are not important or pretending to have another suitor if the present one declines to form an agreement. In this guide, we will discuss the importance of a negotiation contract and the seven common negotiation tactics.
What is a Negotiation contract?
Contract negotiation is the process by which more than two parties discuss the contents of a contract to later form a legally binding agreement on the terms of their partnership. The main objective of a negotiations contract is to make sure that each party is satisfied with the rights and obligations designated to them.
Why is a negotiations contract important?
A negotiations contract allows all parties involved to establish suitable terms that work for them, instead of one party dominating the entire business contract. Moreover, a negotiations contract ensures that a contract is mutually beneficial for all parties involved and that the new business partnership is free from confusion and conflict.
What are the common Negotiation tactics?
The following are some of the more typical contract negotiation tactics that have proven to be effective in the negotiation process:
- Break the negotiation into parts
This tactic is most suitable for instances where one of the parties must agree to all the other party’s terms for the negotiation process to be successful. By breaking the negotiation process into sections, both parties will be able to make progress and agree on individual parts.
- The “offer-concession” strategy
This approach is where you make sure that all parties leave the negotiation process satisfied with the outcome. As the proposing party, you should come up with a flexible contract agreement that leaves room for any necessary adjustable changes.
- The Getting to Yes approach
This is where the negotiating parties must determine the real influence of interest affecting both parties and come up with suitable solutions and justifiable principles of equity among the parties involved.
- Take control
Also known as the “controlling the agenda” approach, where one party controls the negotiation process and decides on the topics to be discussed.
- Top priorities
Since contract negotiations mainly focus on profits and losses, it is important to determine what the top priorities are. This will help you remain focused on your primary objective and avoid getting distracted.
- A question rather than demand
Questions usually help open up the negotiation process and ensure that both parties fully understand all vital information communicated during the negotiation process.
- The “fair” approach
This approach only works when one party’s requests are per the current industry standards and market prices. Here, you will be required to emphasize why you agree to standard deal terms.
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