27 Principles of Negotiating

Feb 1, 2003 12:00 PM, RCM Staff Report

Basics to Keep in Mind

If you ask for something before a contract is signed, it's called “negotiating.” If you
ask for something after a contract is signed, it's called “begging.” It's better to be a
good negotiator than an expert beggar.
From negotiator Chester Karras: “You don't get what you deserve, you get what you
negotiate.”
From motivational expert Zig Ziglar: “You can get anything in life, if you help
enough other people get what they want.”
Everything is negotiable, but everything has a price.
Quoted prices are invitations to buy, but not statements of value.

Important Fundamentals
Terms are just as important as dollars. Many people focus on rates, dates, and
space (the big three of meeting planning), but the other fine print — such as
liability and attrition — can have just as much importance. These things will
translate into dollars.
Negotiate at the proper authority level. Negotiate with the person who can say
“yes.” Don't let your negotiation get lost in the translation. You don't want to have
to negotiate it more than once. Ask to negotiate with someone who has the
authority to go “off the script” or the rate card. Refuse to negotiate with someone
who doesn't have that authority.
If you want something, ask for it. Good negotiators do not put their best terms on
the table first.
Focus on the relationship. It's important that the relationship is still there once
you're through with the negotiations. You don't want to get to the end of an
agreement and never want to see each other again.

The Four Unwritten Rules

In every negotiation, there are four unwritten variables. All exist in every negotiation,
whether or not you know or understand that.
Power
This is the ability to get the other side to do things in the way you see favorable.
The top two power sources are competition and the printed word. If a hotel knows
that four other hotels in town want your business, then that hotel likely will want
your business, too. Hotels play that game, too. They try to get more than one
group interested in the hotel. And remember: Always question the printed word.
Printed rates are not final rates.
 Time
Ninety percent of the negotiating happens in the last 10 percent of the time
allotted. Negotiating will go on forever unless one side imposes a deadline. The
corollary is that time works against the person who doesn't have it. Never reveal
your real deadline, and never negotiate when you're in a hurry.
Knowledge
Knowledge is a combination of expertise and information-gathering regarding the
wants and needs of the other side. How and when is the person you're dealing
with evaluated? How experienced is the person? What's the hotel's average daily
rate, its peak season, and does it have other customers who want the same dates?
Leverage
Leverage is your ability to get the hotel to want your business and to give you
favorable terms.

Negotiating Gambits
Beginning Gambits occur at the start of negotiations.
The Flinch
Most religious meeting planners are born with this: the ability to express shock
and dismay at what the other side is presenting. This technique forces the other
side to adjust.
Feel/Felt/Found Technique
This is a way of acknowledging another person's feelings without giving any
ground. It's also a way to disagree without being disagreeable. Here's the script: “I
understand how you feel. Others have felt the same way, but when they have
found out more about us, they have come around.”
First Offers
The general rule is to never accept the first offer.
The Vise
The purpose of the vise is to squeeze the price range up or down in your favor.
When someone names a price, you say: “You'll have to do better than that.” But
be prepared for the response: “How much better do I have to do?”
Middle Gambits occur during the middle of negotiations, the point at which most
negotiations begin to stall. Middle gambits are used to keep things going, assuming that
you want to do business with this party. There are two basic techniques.
The Trade-Off
Never give a concession without getting a concession. This is the secret to
keeping a negotiation balanced. It keeps the other side from nibbling you to death.
They know they'll have to give up something for everything they get.
The Set-Aside
When you're deadlocked on an issue, set it aside and come back to it after you've
 reached agreement on the easier issues. Why leave the toughest issues for last?
Because by the end of negotiations, the process has momentum and both sides
will have the motivation to be flexible.
Ending Gambits are the end games.
BATNA
When you reach the end and are asking yourself if you should go through with
what you've negotiated, ask yourself: “What's my Best Alternative To a
Negotiated Agreement?”
The Walk-Away
Your ability to negotiate is tied to your ability to walk away from the deal. This is
why you want to give yourself options.

This article was adapted from a tutorial given at a past RCMA conference by John
Foster, III, a lawyer with Foster, Jensen & Gully LLC and a frequent RCMA speaker.

COMPLIMENTS of the Hotel

Hotels normally calculate complimentary meeting space based on the percentage of
rooms that a group is using.
For example, if a group is taking 30 percent of the hotel's rooms, then they're entitled to
30 percent of the hotel's meeting space on a complimentary basis. In this example, if your
group needs 70 percent of a hotel's meeting rooms, then your rooms-to-meetings ratio is
out of whack. They won't say this to you directly, but the hotels will refer to you as a
“space hog.”