Whether you’re a professional purchaser for a company or someone looking to buy a new car, negotiation is the most important skill in your disposal. Though many people believe that the best negotiators are born, anyone can brush up on their skills to better understand how negotiation works.

* This is the most simple but it can be the most overlooked for the novice negotiator: KNOW WHAT YOU WANT! That’s right! Know what you want to gain from the transaction. Is it building a relationship for future business? Is it strictly cost? Or maybe it cost and terms? Whatever it is, know what you want, know where you’re willing to budge and where you’d refuse to move, and know what you want to attain from this transaction.
* Don’t be afraid to negotiate! People can sometime be hesitant to parley, but the truth is you can almost always come to a mutually beneficial arrangement where both parties get what they want. When you enter a professional transaction, the other side expects you to bargain, so don’t be timid.
* Before entering a negotiation, make sure you are 100% confident in the material you will be covering. Know it backwards and forewords and only look back at your papers if you aren’t completely sure on a certain aspect. Right away you’re going to enter the negotiation with confidence which will make you more apt to negotiate effectively.
* Know your BATNA, ZOPA, and Reserve Price. Your BATNA, or Best Alternative To Negotiated Agreement is your plan b in case the other side is playing hardball and refuses to acquiesces to your offer or counteroffer. This way you know that you can walk away if you can’t come to an arrangement. Your ZOPA, or Zone Of Potential Agreement, is the median of your offer and the other sides offer. So, if your looking to buy something, you want to pay the least amount of money as possible. The seller wants to sell the product to you for the highest possible price. As it stands, they’ll make the initial offering which will be considerably higher than what you had in mind. You counter with your offer. The ZOPA will be that middle price where the seller is still making a profit and not cutting into costs, and where you as the buyer aren’t going over budget. Your Reserve Price is the highest amount that you as the buyer are willing to pay, and the lowest price you as the seller are willing to accept. Knowing all of these three paramount topics will strengthen your position up considerably.
* He who says the first number looses. NEVER say the number first. If they ask you to make an offer, say “what did you have in mind?” This repartee can go on for a while; eventually someone will loose, just make sure that this person isn’t you.
* Look to add Value to the negotiation or a, Value Added Transaction. These are things that cost you nothing or close to nothing that you can offer to sweeten the deal or to use as a tactic to get the price you want. Remember, the best negotiators are always the most creative, so Be Creative!.
* If and when, during a negotiation, your rival comes up with a ridiculous price, either one that’s too high or too low, have a chuckle! Serious! Just have a laugh. Laugh like he was saying this just to mess around with you. After all, the price was so unbelievably outlandish it must be a joke. Then move on with your counter offer that you can frame as more realistic. Note: A lot of people don’t take this seriously, but trust me, this is the way they teach it in Harvard Business School.
* Know when to take a brake. Sometimes, especially when dealing with price, negotiations can go on for hours at a complete standstill. Try taking a break. Go grab a coffee or even step out to go to the bathroom. This will give both sides the time away from the boardroom and a little bit of clarity to come back ready to make a deal.
* Know when to walk away. If the deal is just garbage, or they are refusing to budge, shake hands and say goodbye. If they really want your business they will call you back immediately. Knowing your BATNA will really increase your confidence and ability to do this maneuver.