I just sold a bunch of office furniture. I sold off the expensive stuff piecemail -- computers, electronics -- and gave away some of the more fun gear like whiteboards and kitchen stuff. But I still had a nice conference table, about a dozen nice chairs, and some desks and smaller tables.
I sold it to a Chinese real estate agent. I got half of what I asked for, which is 20% lower than I wanted, but 100% higher than I was expecting (I figured I'd just have to dump it).
But here's an interesting note about negotiation -- including in the bunch of stuff was a safe. The safe wasn't very expensive, very nice, or a big part of the deal.
Unfortunately, we lost the key for the safe. It was electronic, but you needed a key to set it. Or something. I don't know, the safe never worked.
The safe's price was cheap. Maybe $120. It really wasn't a very nice safe. But the agent buying the stuff kept going on and on about it. "Where's the key? The strongbox is so nice... it's a great strongbox... gosh, I really want the strongbox..."
This made little sense to me at the time, but I realize now what it was -- he was finding a reason to lower the negotiation price. He went on and about wanting the safe after he'd noticed the safe might not work.
He also kept going on about how it would be hard to store the stuff (probably true, it was heavy and large) and he'd have to probably pay movers twice to move it.
Interestingly, he outright refused to look at the spreadsheets of costs or the book from the furniture company when I wanted to show him the price. He kept going on about the safe, and the moving cost, and how hard it would be to store. But when I wanted to show him the book from the company it came from, or the spreadsheet of the cost of everything, he outright refused.
Interesting note, eh? This is universal to some extent, but also because China is a very "face-saving" culture, if he sees the price of things is high and the quality is high, he almost can't make so low of an offer. He also had to find a way to justify the low offer so I could "save fence" -- hence, all the talk about the safe.
As it turned out, my BATNA (Best Alternative to Negotiated Agreement) was pretty bad and I had been willing to write the furniture off entirely so I was happy with what I got. Early on in the negotiation I said my friend would be helping move it tonight, before he said he wanted to buy -- I said it casually which is probably I got half of my opening offer... which was fine with me compared to $0.
But think I maybe could have gotten a little more if I'd cut the safe talk off early -- "Dude, the safe is the cheapest thing here. The rest of the stuff costs 7x more than the safe. Throw the safe out and you're still getting a great bargain" -- and drawn attention to the original cost and built up the value more before tossing out a number.
Still, BATNA rules all and I had basically no leverage. Though I could have possibly squeaked out slightly more cash. In a negotiation, especially in a face-oriented culture, consider how your counterparty might frame his offer for a lower price, and look to steer the conversation to slightly more favorable ground related to building up value.
On the flipside, navigate to additional costs or find a missing feature if you're buying... I just learned from this particular negotiation. Obviously leverage and BATNA rule all, and if yours are much worse than theirs, you're soaked regardless of discussion or positioning. But keep in mind, you can probably get a few more percentage points for yourself if you're on conversational ground that's favorable to you.
I'd never heard of BATNA before, but damn is it useful. If you don't need the negotiation, you can push more and get more from it. And the idea to draw attention to additional costs is a great one for buyers.
If you're down to learn in depth negotiating, check out Ramit Sethi's series on it (it's geared towards negating with businesses and bills more than people, but the ideas work overall). I used it about a year ago and saved about $400 a year on bills.
Any specific bills you negotiated?
Why was your comment that your friend would be helping to move it that night significant? I must be missing something.
Well, obviously I haven't already founder a buyer for the stuff if I'm pitching it to him.
So consider two scenarios from his perspective --
(1) The foreigner is just going to leave the furniture here and/or throw in the trash if he can't find a buyer.
(2) The foreigner is going to have a big hassle moving to his friend's house, sweating, and not sure if he can find a buyer... but at least believes he won't get zero.
#2 is still bad. Much better than #1 though.
First off, quick refresher - what is negotiation?
Good negotiation is about discovering things you value a low amount that the other party values a high amount, finding things they value a low amount that you value highly, and exchanging. I wrote about this in "How to Avoid Exchange-Based Relationships" -
A lot of people don’t understand good negotiating. They think it’s about getting the best price – no, no, no. Good negotiation is about figuring out what you can offer that’s worth more to the other person than you, and what they can offer that’s worth more to you than them.
it’s okay to have pure exchanges sometimes, like if you’re just buying something once. But if you can transcend that, move it beyond the exchange and into looking out for each other, that can be a beautiful thing.
This is an excerpt from my May 2013 Monthly Financial Review. I thought it was worth reposting here.
A lesson in negotiation
I've been reading a lot lately, mostly business and personal development books. Here's a quote from Sebastian Marshall's Ikigai: