Tag Archive for: Negotiating Coach

Unlock the Secrets of Effective Sales Negotiation: Stop ‘Buying the Sale’ and Boost Your Bottom Line!

Unlock the Secrets of Effective Sales Negotiation: Stop ‘Buying the Sale’ and Boost Your Bottom Line!


There are ongoing troublesome behaviours that continue to plague inexperienced and experienced negotiators

Based on our research and significant experience providing negotiation skills training, negotiating coaching, and consulting expertise to corporations, small business owners, and individuals, it’s apparent that there are ongoing troublesome behaviours that continue to plague inexperienced and experienced salespeople, sales managers, and businesspeople, in any industry, when it comes to negotiating.

I’m not convinced that the millions of dollars companies spend annually on so-called “sales training” adequately improves – or changes most salespeople’s and sales managers’ behaviours.  There is a proliferation of articles, blogs, LinkedIn posts, and numerous videos and webinars that attempt to help people follow a sales process and methodology, uncover customer needs and dominant buying motives, and try to instruct people on how to sell their company’s differentiated value proposition.

Based on the specific customer/account/client circumstances and market conditions, sellers at all levels of selling sophistication often focus too much on a price-based or concession-driven sale.  In most selling situations, salespeople don’t realize that they’re not negotiating correctly – or negotiating at all – and they’re simply “buying the sale.”

The Strategy for a Sales Negotiation

The real art of effective sales negotiating is to complete a satisfactory exchange without giving away more than necessary.

The challenge is identifying all the potential components for exchange and realizing how much value you and, more importantly, your customers/clients/accounts place on each component.  There can be many interdependent variables and moving parts involved in a negotiation.

Most salespeople spend far too much time making excuses or blaming these interdependent variables and moving parts for the less-than-desirable outcome they achieve.  Too often, organizations and salespeople fall victim to their flawed negotiating process and practices.  Their idea of negotiation usually involves an oversimplified barter process using an increasingly expensive package of financial and non-financial concessions that result in the salesperson “buying the sale.”

As the marketplace continues to be increasingly complex and competitive, salespeople (and sometimes their less-than-stellar sales managers) often don’t have the necessary negotiating skills.  Without the required skills, people often resort to the more common and easier-to-do “concession sale.”

The High Cost of Poor Sales Negotiation Skills

Picture this familiar scenario: A salesperson makes what they think are gratuitous concessions, believing they are closing in on an acceptable deal.  However, as they near the opportunity to close the sale, they realize that the other side sees all the concessions made as merely the starting point for a final negotiation.  The salesperson is then “trapped” into making additional concessions to get the business and close the deal, having already committed their company to everything they have “thrown in” along the way.

Not only has the actual transaction cost gone up, but the salesperson can’t be sure that their initial concessions were required in the first place.  One thing is clear: Reclaiming “spent” concessions given to customers is extremely difficult, and those concessions have become part of the ‘base package’ that the customer now expects to receive.

Because negotiating skills are not adequately refined on the selling side, some corporations are experiencing a gradual erosion of their profit margins.

On the buying side, sophisticated customers/clients are more successful at negotiating and increasing their profitability using their “situational power.”  Most sellers are unaware of “situational power” and how they can potentially counter its use.

This challenging dynamic has generated many vulnerable suppliers (sellers) prepared to give more significant concessions at each transaction to maintain their gross sales revenue or unit volume in the face of collapsing profit margins.

Effective Sales Negotiation Strategies and Tips

Here are some effective sales negotiation strategies and tips to help salespeople, sales management, and businesspeople avoid “buying the sale” when negotiating:

  • Learn and follow a disciplined negotiating process and methodology.  Companies and individuals must invest in negotiating skill development and make good negotiation skills and practices an organization-wide capability.
  • Planning and preparation are the most critical components of a negotiating process.  More often than not, salespeople and sales managers “cheat” and don’t do thorough or sufficient research before starting any sales negotiation.  You should always carefully and thoroughly plan and prepare for all sales negotiations  – even if the salesperson and company have existing business relationships with customers.  Why?  Because things are constantly evolving and changing – “You don’t know what you don’t know.”
  • Carefully determine, understand, and correctly diagnose the actual customer decision-making process and authority, wants, needs and dominant buying motive – before developing your price- or solution-based proposals or responses to an RFQ/RFP/RFI bid/tender process.
  • Companies and salespeople must develop and utilize compelling, effective, and persuasive price- and solution-based proposals and capability presentations. (Why buy from our company and me?) Salespeople make costly mistakes when they use the terms “quote or price quote” as part of their sales vocabulary.
  • Learn and understand effective customer value chain management.
  • Capture and record all your costs (e.g., couriers, product samples, technical support, etc.) that you’ve provided to customers during the year and claim value for these costs in the next negotiation.
  • Identify all the financial and non-financial concessions you are prepared to make and fully understand the cost of each potential concession.  Don’t assume there is “value” in a concession because there is cost.
  • Invest in the appropriate negotiation skills training and negotiating coaching and commit to adequately implementing and integrating the negotiating process, strategies, tactics, verbal phrases, scripts, questions, and questioning techniques.
  • Reinforce your negotiating training annually to stay one step ahead of your customers and competitors.

Remember: Nothing affects the bottom line of your company more – or your income more – than having effective sales negotiation strategies and skills.  You can’t make money faster than when you’re negotiating effectively!


Take Action and Invest in Our Expert Negotiating Training and Negotiation Coaching Packages, Negotiation Tools, and Online Course to Become a Better Negotiator.

» Negotiating Skills Training: Book a tailored in-house presentation, seminar or learning workshop for your organization.

Speaking Engagements – Industry Associations and Companies: Book a tailored, engaging, and impactful 60-minute to two-hour presentation at an upcoming meeting, conference or convention.

» Negotiating Coaching Packages: If your company is facing a challenging high-value negotiation and you need an expert to help you or your team – or you own a small business – or you’re an individual who needs practical negotiation advice, you can benefit from my investing in one of my three proven, results-producing negotiation coaching packages for individuals, small business owners or corporations.

» Digital Negotiation Learning Products: You can purchase my three E-books containing powerful strategies and tips.  E-books: Forensic Blueprinting Questions For Effectively Selling and Negotiating Price or Fee Increases and Managing the Price-driven Sale, Selling and Negotiating Price or Fee Increases in Any Economic Environment, and Strategies and Tips on How to Effectively Manage the RFP/RFQ/RFI or Bid/Tender Process to Optimize Results and Outcomes.

You can also purchase the Negotiating Personality Type and Corresponding Negotiating Style Self-Assessment Questionnaire and Interpretation Results and my NEW Digital MP3 “Greatest Hits” Verbal Negotiating Phrases, Scripts, Questions, and Questioning Techniques.  These helpful tools are in digital format and can be easily downloaded.

I provide a discounted Master Negotiator Bundle with all my Digital Learning Products.

» Online Sales Negotiation Course: If you’re in sales, sales management or a cross-functional role that supports sales, you can benefit from enrolling in my NEW self-paced Negotiating for Sales Success online course.

» Meet Negotiating Coach® Michael E. Sloopka

No part of this copyright material can be used without written permission from Selling Solutions Inc.

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Five Common Negotiation Mistakes You Must Avoid

Five Common Negotiation Mistakes You Must Avoid


Mastering the Art of Negotiation: Avoiding Common Pitfalls for Success

Negotiation is an essential life skill in our personal, social, and business lives. Whether negotiating the terms and conditions for a purchase order with a supplier, a promotional program with a customer or discussing curfew with your teenager – the art, science, and sport of negotiation is an essential skill that can impact outcomes.

Many people need help understanding and dealing with the common pitfalls hindering their negotiation success.  In this article, I’ll explore the five mistakes people make when negotiating and how to avoid them.

Mistake #1: Failing to Prepare and Plan Thoroughly

It doesn’t matter whether people are involved in a complex or what people perceive as a straightforward negotiation.  One of the most significant errors in negotiation is that people need to do much better with preparation and planning.

It’s tempting to dive into a negotiation headfirst, but successful negotiators invest time in understanding their objectives, knowing their counterpart’s interests, researching, and anticipating potential objections.  Preparation and planning are the foundation upon which successful negotiations are built.  Without it, you’re navigating uncharted waters blindfolded, and you won’t likely do well.

Mistake #2: Neglecting Active Listening and Not Asking Good Questions

Effective communication is at the heart of negotiation; a crucial component is active listening.  People often get so caught up trying to make their point that they forget to listen to the other side.  When you truly listen, you gain insights into the other person’s needs and motivations.  This information is your most valuable asset in reaching a mutually beneficial agreement.

This mistake is particularly true for most salespeople and sales management.  Stop talking, listen, and ask effective blueprinting questions.  In our negotiation skills training programs and coaching sessions, we provide our clients with proven best practice questions and questioning techniques they can use to improve results in all their negotiations.

Mistake #3: Letting Emotions Dictate the Conversation

Emotions can cloud judgment and lead to impulsive decisions.  Letting your emotions take the driver’s seat can be a negotiation disaster, whether anger, fear, frustration, insecurity or impatience.  Instead, practice emotional intelligence.  Recognize your emotions, but don’t let them steer the conversation.  It’s important to understand that arguing intensifies peoples’ desire to prove themselves right.

Do your best to stay composed and rational when facing challenges.  Focus on the process and not the personalities involved in the negotiation.  When meeting confrontational or argumentative people in any negotiation or discussion – we recommend that our clients use the “Feel, Felt, Found” technique.  We also provide our clients with two powerful questions that will help them to separate “content versus emotion” in any negotiation.

Mistake #4: Neglecting Win-Win Solutions

Negotiation is not a zero-sum game.  It’s not about one side winning at the expense of the other.  Strive for a win-win solution that addresses both sides’ interests.  A successful negotiation leaves everyone feeling satisfied and valued, which can lead to better long-term relationships and future opportunities.  I provide my clients with a one-page Negotiating Behaviour Matrix diagram that helps them with their negotiation approach based on concern for substance versus the relationship.

Mistake #5: Overlooking Alternatives

Sometimes, negotiations hit obstacles, impasses, and deadlocks.  If you become fixated on a single solution, you risk overlooking alternative paths to success.  Always have a Plan B (and maybe even a Plan C) in your back pocket.  This flexibility can prevent you from making costly concessions you’ll regret later.  It’s also essential to develop your walk-away position in any negotiation – should the terms and conditions not meet your needs. Broadening the scope of negotiations is one of our three rules for negotiation.

Conclusion

In conclusion, the art, science, and sport of negotiation is a critical skill in both personal and business contexts.  By avoiding these common mistakes – failing to prepare, neglecting active listening, not asking good questions, letting emotions dictate, neglecting win-win solutions, and overlooking alternatives—you can unlock new levels of success at the negotiation table.

Remember, negotiation is not just about getting what you want; it’s about creating value and building meaningful relationships.  So, approach each negotiation with strategy, empathy, and a willingness to explore creative solutions, and watch your success soar.


Take Action and Invest in Our Expert Negotiating Training and Negotiation Coaching Packages, Negotiation Tools, and Online Course to Become a Better Negotiator.

» Negotiating Skills Training: Book a tailored in-house presentation, seminar or learning workshop for your organization.

Speaking Engagements – Industry Associations and Companies: Book a tailored, engaging, and impactful 60-minute to two-hour presentation at an upcoming meeting, conference or convention.

» Negotiating Coaching Packages: If your company is facing a challenging high-value negotiation and you need an expert to help you or your team – or you own a small business – or you’re an individual who needs practical negotiation advice, you can benefit from my investing in one of my three proven, results-producing negotiation coaching packages for individuals, small business owners or corporations.

» Digital Negotiation Learning Products: You can purchase my three E-books containing powerful strategies and tips.  E-books: Forensic Blueprinting Questions For Effectively Selling and Negotiating Price or Fee Increases and Managing the Price-driven Sale, Selling and Negotiating Price or Fee Increases in Any Economic Environment, and Strategies and Tips on How to Effectively Manage the RFP/RFQ/RFI or Bid/Tender Process to Optimize Results and Outcomes.

You can also purchase the Negotiating Personality Type and Corresponding Negotiating Style Self-Assessment Questionnaire and Interpretation Results and my NEW Digital MP3 “Greatest Hits” Verbal Negotiating Phrases, Scripts, Questions, and Questioning Techniques.  These helpful tools are in digital format and can be easily downloaded.

I provide a discounted Master Negotiator Bundle with all my Digital Learning Products.

» Online Sales Negotiation Course: If you’re in sales, sales management or a cross-functional role that supports sales, you can benefit from enrolling in my NEW self-paced Negotiating for Sales Success online course.

» Meet Negotiating Coach® Michael E. Sloopka

No part of this copyright material can be used without written permission from Selling Solutions Inc.

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Five Insights to Unlock the Secrets to Winning Negotiations and Achieving Success

Five Insights to Unlock the Secrets to Winning Negotiations and Achieving Success


Negotiating is an essential life skill, and it’s a learned skill.

Negotiating is an integral part of our daily lives, and understanding negotiating dynamics can be a game-changer for people.  Whether you’re negotiating with customers, suppliers, contractors, colleagues, employees, employers, cell phone providers, or banks – or you’re discussing curfew with a teenager, here are five vital things to keep in mind:

1. Almost everyone should be negotiating – people are constantly negotiating.

You could be involved in a negotiation whenever you communicate with another person.  Negotiation isn’t just for labour disputes and union negotiations, government trade talks, dispute resolution, mediations, and athlete negotiations with pro sports teams.

If you can master the art of structuring your negotiations so you get what you want and the other side can get what it wants, you’ll increase your success while eliminating anxiety, stress, and discomfort.  People need to stop negotiating based solely on their “instinct.”

2. Everything you want is owned or controlled by others.

If you want something, you’ll find it’s usually owned or controlled by someone else.  To get what you want, you’ll need to invest the time to learn how to get it.  To achieve your goals, learn how to deal with people by helping them get what they want – rather than dominating or taking advantage of them in a negotiation.  Empower others to get what they want and watch the doors of opportunity swing open.

3. Negotiating involves predictable maneuvers.

Negotiation shouldn’t be a disjointed, chaotic, and anxiety-producing process.  There are predictable responses to maneuvers that take place in most negotiations.  In our negotiating training seminars, workshops, and negotiation coaching sessions, we refer to these maneuvers as gambits and countergambits; they refer to strategic exchanges to gain an advantage in any negotiation.  The term gambit is chess parlance that means maneuver for advantage.

You will want to learn to use certain negotiation gambits to your advantage; however, you will also need to know a wide range of gambits and countergambits, even those you might not use, to protect yourself if negotiating gambits are used against you by the other side.

4. Three essential factors can make or break your negotiations:

Information: Knowledge about the other side is critical.  Understand your counterpart’s needs, desires, and objectives.  Do your research well in advance of negotiating.  The side with the most in-depth and relevant information usually does better in a negotiation.

Time: Negotiations often have deadlines that can add pressure.  Use time wisely to secure favourable outcomes.  Line up all the details well in advance of any negotiation.  Time limitations and deadlines add pressure for a settlement.

Personal Power: The ability to influence others is a potent tool.  Learn more about the eight forms of personal power and how to wield it while guarding against its misuse effectively.

People have four different personality types and corresponding negotiating styles:

Four major personality types influence a person’s negotiating style.  This is not about using astrology or a Myers-Briggs or DISC profiling self-assessment tool to determine your negotiating personality type.  The four negotiating personality types include – Analytical, Pragmatic, Extroverted, and AmiableLearn more about your personality type, corresponding negotiating style, and how to interact more effectively with others.  Pay attention to “clues” that can provide insights into personality types.

Contact me to learn more about determining your negotiating personality type and corresponding negotiating style through a self-assessment questionnaire and interpretation information.

Summary:

By understanding these five fundamental principles, you’ll be better equipped to navigate the intricacies of negotiation, achieving your objectives, and fostering positive relationships.  So, whether you’re closing a multimillion-dollar deal or negotiating a household dispute, remember that negotiation is about more than just reaching an agreement – it’s about forging connections and achieving mutual satisfaction.

Remember, negotiation is not just about getting what you want; it’s about creating value and building meaningful relationships.  So, approach each negotiation with strategy, empathy, and a willingness to explore creative solutions, and watch your success soar.


Take Action and Invest in Our Expert Negotiating Training and Negotiation Coaching Packages, Negotiation Tools, and Online Course to Become a Better Negotiator.

» Negotiating Skills Training: Book a tailored in-house presentation, seminar or learning workshop for your organization.

Speaking Engagements – Industry Associations and Companies: Book a tailored, engaging, and impactful 60-minute to two-hour presentation at an upcoming meeting, conference or convention.

» Negotiating Coaching Packages: If your company is facing a challenging high-value negotiation and you need an expert to help you or your team – or you own a small business – or you’re an individual who needs practical negotiation advice, you can benefit from my investing in one of my three proven, results-producing negotiation coaching packages for individuals, small business owners or corporations.

» Digital Negotiation Learning Products: You can purchase my three E-books containing powerful strategies and tips.  E-books: Forensic Blueprinting Questions For Effectively Selling and Negotiating Price or Fee Increases and Managing the Price-driven Sale, Selling and Negotiating Price or Fee Increases in Any Economic Environment, and Strategies and Tips on How to Effectively Manage the RFP/RFQ/RFI or Bid/Tender Process to Optimize Results and Outcomes.

You can also purchase the Negotiating Personality Type and Corresponding Negotiating Style Self-Assessment Questionnaire and Interpretation Results and my NEW Digital MP3 “Greatest Hits” Verbal Negotiating Phrases, Scripts, Questions, and Questioning Techniques.  These helpful tools are in digital format and can be easily downloaded.

I provide a discounted Master Negotiator Bundle with all my Digital Learning Products.

» Online Sales Negotiation Course: If you’re in sales, sales management or a cross-functional role that supports sales, you can benefit from enrolling in my NEW self-paced Negotiating for Sales Success online course.

» Meet Negotiating Coach® Michael E. Sloopka

No part of this copyright material can be used without written permission from Selling Solutions Inc.

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Mastering Mortgage Negotiation: A Practical Guide for Homeowners in the US and Canada

Mastering Mortgage Negotiation: A Practical Guide for Homeowners in the US and Canada


Unlock Potential Savings with Smart Mortgage Negotiation Strategies

The looming mortgage situation for the rest of 2023, 2024, and probably 2025 indicates that a staggering wave of mortgage challenges is hurtling toward homeowners that will undoubtedly cause stress, anxiety, and financial hardship for tens of thousands of people.

Brace yourself for the thunderous impact of 10.1 million mortgages set to mature this coming year in North America, shaking the very foundations of the real estate market.  Here’s the spine-chilling twist: a vast number of homeowners are about to plunge headfirst into a financial abyss, shackled by interest rates that rival “loan shark” territory, with some borrowers teetering on the precipice of ruin, paying a staggering average of 5.1% to 8.3% interest on their life’s most significant investment.

Hold onto your seats as we delve into the treacherous landscape of mortgage negotiations and renegotiations – where the stakes have never been higher, and the consequences will reverberate throughout the North American economy.

Negotiating your mortgage terms can yield significant savings and favourable conditions. This article’s insights, strategies, and tips will help you negotiate confidently in the United States or Canada.  In today’s challenging mortgage market, understanding the nuances of the negotiating process is essential for success.

A few words of caution.  Make sure you investigate your local lending regulations and mortgage broker licensing requirements.  Also, pay attention to details and have a qualified person carefully review legal documentation.  You don’t need to make your situation worse by having to live with problems associated with legal documents. Remember, a mortgage is a legal document.

Get Help: While I’m not a mortgage broker, I specialize in negotiation coaching, consultancy, and training.  Contact me for personalized guidance in navigating the complex world of mortgage negotiations.  With my tailored coaching packages, I provide expert advice and empower you with the applicable negotiation strategies, tactics, techniques, phrases, scripts, questions, and questioning techniques to help you improve your outcomes. Let’s work together to gain a negotiating advantage in the mortgage market.

Know When and How to Negotiate

Understanding the Art of Mortgage Negotiation

When securing a mortgage for the first time or a renewal, you’ll often encounter posted rates at various traditional and non-traditional financial institutions.  However, during these difficult economic times, people might be so anxious to apply for a mortgage – or desperate to renew a current mortgage that they don’t start researching, gathering information, and negotiating early enough.  Some people don’t bother negotiating mortgage rates, terms, and conditions – some believe mortgage rates are set in stone.

You can secure a better outcome with the proper negotiation approach, strategies, and tactics.

For instance, negotiating skills could reduce the interest rate if the advertised five-year fixed mortgage rate is 5.5% with a reasonable amortization period.  Besides the interest rate, you can also discuss contract details like prepayment options, cash-back benefits, and terms and conditions. Your ability to negotiate depends on your preparation, planning, and negotiating skills – and the skills of your mortgage broker, should you decide to use one.

Strategic Timing for Mortgage Negotiation

To maximize your negotiation power, there are three key things to consider:

  1. Securing a New Mortgage
    This is a prime time for negotiation, as multiple lenders may be interested in vying for your business – as long as your application is solid.  Take your time; shop around and see if your preferred lender can match or surpass their competition’s offers.  Remember, financial institutions need to get profitable, low-risk loans on their books.  Therefore, there is some pressure on lenders to loan mortgage money – as long as your income supports loan repayment and the loan-to-value ratio is acceptable to the lender’s mortgage underwriters.
  2. Renewing Your Mortgage
    You receive a renewal letter from your current lender a few months before your mortgage term ends. Instead of accepting it immediately, take your time to do research and explore other offers.  Switching lenders may save you enough money to make the negotiating effort worth it.
  3. During Your Mortgage Term
    If market conditions favour it, you might renegotiate or refinance your mortgage for a better rate even before the term expires.  Ensure you understand the prepayment fees, terms, conditions, and any potential risks involved.

Don’t Hesitate to Ask and Negotiate for a Discount

Most financial institutions publish mortgage interest rates, which can often be negotiated lower, especially with a strong application and credit rating.  The size of any potential discount depends on market conditions and the lender’s policies.

While you might wonder why they publish rates if discounts are possible, it’s because some homebuyers or homeowners accept the published rates, and these rates are used to calculate penalties in case you need to break your mortgage early.

Shop Around for Savings

Always shop around, whether getting a new mortgage or renewing the current one. Even though various lenders offer similar rates, slight differences can lead to substantial savings.  Contact multiple lenders to find the best rate; your preferred lender may be willing to match the lowest offer.

The Power of Using Mortgage Brokers

Consider using a mortgage broker.  These licensed professionals work with multiple lenders, ensuring they can provide you with a cross-section of offers and the best terms available.  Sometimes, mortgage brokers can be beneficial for unique situations like self-employment.  If things get “desperate,” mortgage brokers may be able to access different types of lenders (including hard money lenders) with more flexible lending criteria.  Origination fees and interest rates will be higher for these types of scenarios.

Remember, the lender compensates mortgage brokers; therefore, using a mortgage broker is a convenient option for borrowers.

Warning: Be very careful of mortgage brokers or lenders presenting you with potential solutions for your mortgage who may unintentionally or intentionally mislead – or misinform you and don’t deliver the solution.  Also, don’t assume the mortgage broker is negotiating the best possible outcome for you.  The commissions a mortgage broker could potentially earn may not justify them spending an excessive amount of time on negotiation.

Recommendation: If you’re looking for a trustworthy professional mortgage broker, contact David Pipe.  David is licensed in the Province of Ontario, Canada.  David can also help Canadian out-of-province clients with their mortgage needs.  He has the necessary experience, expertise, industry connections, and skills to help people find mortgage solutions.  David provides a complimentary, no-obligation consultation for his potential clients.

Strategies for Successful Mortgage Renewal Negotiation

Keep an Eye on Market Interest Rates

Even if you’re not currently in the market for a new mortgage, monitoring interest rates is wise.  If you’re on a fixed-rate mortgage and rates drop, inquire with your lender about blending and extending your mortgage, potentially saving you money.  Conversely, if you have a variable-rate mortgage and rates increase, consider switching to a fixed-rate mortgage for potential savings.

Beyond Interest Rates: Consider Your Prepayment Options

When negotiating your mortgage, don’t fixate solely on interest rates. Consider the prepayment privileges offered. Making extra payments without incurring fees can be immensely beneficial, especially if you anticipate a windfall of funds in the near future.

Optimize Your Mortgage Application

A strong and thorough application can lead to better interest rates – or a less stressful approval process.  A substantial down payment, a good credit history/rating, and a reasonably stable income are factors that lenders consider favourably. If you have outstanding debts, consider reducing them before applying, as this can improve your overall financial picture.

It’s a good idea to check your credit report using one of the major credit reporting companies.  If you notice discrepancies on your credit report, make sure you get those corrected – before you apply for a mortgage.

Your Mortgage Renewal – A Golden Opportunity:

Renewing your mortgage isn’t a task to take lightly.  Instead of settling for the first offer, invest time researching and negotiating to secure terms that align with your financial goals. By following these seven strategies, you can optimize your outcome.

Don’t Overlook Your Mortgage Renewal Letter

Don’t wait until the last minute to take action.  Upon receiving your mortgage renewal letter, paying attention to it is vital. Failing to contact your lender may result in automatic renewal into an open mortgage term with considerably higher interest rates.

Study the Renewal Offer Thoroughly

Before negotiations, thoroughly understand the renewal offer, including the offered interest rate, term length, prepayment privileges, and amortization period.  Adjusting the term may affect your rate.

Research for the Best Rates

Do an Internet search for “best mortgage rates + your city/province/state” to find the most competitive rates in your local area.

Compare Apples to Apples

Ensure you’re comparing the same type of mortgage as the one in your renewal letter.  Some lenders offer better rates for insured mortgages, so verify that you’re comparing the correct type of mortgage.

Seek Professional Advice

Consider consulting a qualified Financial Planner, Accountant, Mortgage Advisor or Mortgage Broker for expert guidance regarding the lowest rates, terms, and conditions to understand your mortgage’s role in your overall financial plan.

Initiate Negotiations

Approach your lender with the rate and conditions you prefer.  Ensure you’re clear and concise in your communication.  Be careful of “Funny Money” and using percentages when you negotiate.  Always deal in real money terms when negotiating.  Understand the financial impact of a 0.25% increase – or reduction in your mortgage interest rate – in real money.

Clarify Switching Costs

If you’re considering switching lenders, understand the associated costs and inquire if the new lender can cover them.  Be careful of the “fine print.”  Switching costs can be expensive.

Summary

Negotiating your mortgage, whether for a new purchase or renewal, demands your attention and proactive efforts.  You can secure the best possible rates and terms with the right strategies and information.

Your mortgage renewal negotiation allows you to align your financial situation with your goals and save money. So, feel free to explore your options and negotiate until you find the perfect mortgage agreement for your needs and your circumstances.

As we draw the curtains on this expedition into the intricate world of mortgage negotiations, it’s abundantly clear that arming oneself with knowledge, negotiating skills, strategies, tactics, phrases, questions, and questioning techniques could be the key to weathering the storm and emerging victorious.

Numerous interdependent variables and moving parts are involved in negotiating or renegotiating your mortgage.  In a landscape where hundreds of thousands of mortgages hang in the balance and interest rates continue to cast their ominous shadow, the power to secure your financial future lies in your hands.

Your mortgage is more than just a loan; it’s a financial instrument that can shape your life for years to come. So, remember this: knowledge is your sword, patience is your shield, and persistence is your armour. By negotiating intelligently, you can transform the daunting mortgage market into a realm of opportunity and financial well-being.

Remember: A negotiated dollar is a bottom-line dollar.  You can’t make – or save money faster than when you’re negotiating.


Take Action and Invest in Our Expert Negotiating Training and Negotiation Coaching Packages, Negotiation Tools, and Online Course to Become a Better Negotiator.

» Negotiating Skills Training: Book a tailored in-house presentation, seminar or learning workshop for your organization.

Speaking Engagements – Industry Associations and Companies: Book a tailored, engaging, and impactful 60-minute to two-hour presentation at an upcoming meeting, conference or convention.

» Negotiating Coaching Packages: If your company is facing a challenging high-value negotiation and you need an expert to help you or your team – or you own a small business – or you’re an individual who needs practical negotiation advice, you can benefit from my investing in one of my three proven, results-producing negotiation coaching packages for individuals, small business owners or corporations.

» Digital Negotiation Learning Products: You can purchase my three E-books containing powerful strategies and tips.  E-books: Forensic Blueprinting Questions For Effectively Selling and Negotiating Price or Fee Increases and Managing the Price-driven Sale, Selling and Negotiating Price or Fee Increases in Any Economic Environment, and Strategies and Tips on How to Effectively Manage the RFP/RFQ/RFI or Bid/Tender Process to Optimize Results and Outcomes.

You can also purchase the Negotiating Personality Type and Corresponding Negotiating Style Self-Assessment Questionnaire and Interpretation Results and my NEW Digital MP3 “Greatest Hits” Verbal Negotiating Phrases, Scripts, Questions, and Questioning Techniques.  These helpful tools are in digital format and can be easily downloaded.

I provide a discounted Master Negotiator Bundle with all my Digital Learning Products.

» Online Sales Negotiation Course: If you’re in sales, sales management or a cross-functional role that supports sales, you can benefit from enrolling in my NEW self-paced Negotiating for Sales Success online course.

» Meet Negotiating Coach® Michael E. Sloopka

No part of this copyright material can be used without written permission from Selling Solutions Inc.

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Is Splitting the Difference a Winning Negotiation Strategy or a Flawed Approach?

Is Splitting the Difference a Winning Negotiation Strategy or a Flawed Approach?


Unpacking the Pros and Cons of Splitting the Difference in Negotiations

Negotiation is a dynamic art that requires a deep and thorough understanding of negotiating strategies, tactics, techniques, and tips and the ability to adapt to various situations. One common and often misunderstood and misapplied strategy in negotiation is “splitting the difference.”

This is especially true in commercial negotiations involving monetary and non-monetary concessions that provide value.

While “splitting the difference” may seem straightforward and fair, there are pros and cons to consider when deciding whether to employ this strategy in your negotiations.  In our negotiating skills training programs and negotiation coaching sessions, we encourage “splitting the difference” when the circumstances support using this negotiating gambit (chess parlance meaning manoeuvre for advantage.)

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The Pros of Splitting the Difference:

  1. Quick Resolution: Splitting the difference can expedite the negotiation process, making it an attractive option when time is of the essence.  It’s a simple way to find a middle ground and move forward.
  2. Fairness: This method can create a perception of fairness in the negotiation.  Parties may feel both sides are making equal concessions, promoting goodwill and cooperation.
  3. Maintaining Relationships: When dealing with long-term “partners” or maintaining professional relationships, splitting the difference can prevent hard feelings and keep lines of communication open.
  4. Simplicity: When appropriately taught and understood in the proper context, splitting the difference is easy to understand and execute, making it accessible for experienced and novice negotiators.  When splitting the difference, people must learn and use correct verbal and written phrases and scripts – or using this negotiation gambit could backfire.

The Cons of Splitting the Difference:

  1. Missed Value: Splitting the difference might mean leaving value on the table.  It must consider each party’s specific needs and priorities, potentially resulting in a suboptimal outcome.
  2. Lack of Creativity: This strategy can stifle creative problem-solving.  Instead of exploring innovative solutions, negotiators settle for the middle ground.
  3. Ineffective in Complex Negotiations: In intricate or high-stakes negotiations, splitting the difference often needs to be revised.  It needs to have the sophistication required for complicated deals.
  4. Presumption of Equal Concessions: While it may seem fair, in some cases, one side may be making a more significant concession, creating an imbalance.

How Splitting The Difference Can Be Used to Your Advantage

The Negotiating Gambit: It’s generally a good strategy in a negotiation not to offer to split the difference.  There are some situations during a negotiation where it’s an excellent strategy to get the other side to split the difference.

The use of this negotiation strategy depends on where you are in your negotiating range during the negotiation.  Your negotiating range is between your opening negotiating position (initially, ask for more than you want and expect to get – based on the Maximum Plausible Position – MPP) and your desired outcome (your goal).

Suppose you are on the high side of your desired outcome (goal), between your desired outcome and opening negotiating position.  In that case, you can suggest to the other side to split the difference, which would result in your successfully being able to bracket between your high position on your negotiating range.  It creates the perception that you made a concession, and what you did was simply bracket to achieve a better outcome.

Example: In a sales negotiation, you proposed a price for a new piece of equipment to a customer at $31,997.95, plus taxes and shipping.  The price you proposed is based on your opening negotiating position.  Your desired outcome (goal) for the negotiation is to sell the equipment at $26,995.95, plus taxes and shipping.

The customer doesn’t have the budget for your proposed asking price and suggests a price of $25,000.00.  Based on this, you’re $6,997.95 lower than your opening negotiating position and $1,995.95 lower than your desired outcome.  Now, it’s an intelligent strategy to suggest to the other side to split the difference.

You could say something like this to the customer: “We’re not that far apart, so does it make sense to split the difference?  We’ll each compromise $3,498.55 and agree on the purchase price of $28,499.40, plus taxes and shipping.”

By suggesting to the other side to split the difference and by properly bracketing between your opening negotiating position and your desired outcome, you have effectively indicated that the equipment be sold for $1,503.45 more than your desired outcome (your goal).  You’ve created a Win-Win outcome by conceding some of your negotiating range to the customer.

The Negotiating Countergambit: You can protect yourself from splitting the difference yourself in a negotiation by using the Higher Authority gambit.

You can say the following to a customer: “We’re only a few thousand dollars apart on a piece of equipment that will improve your operations.  It seems a shame to walk away from this after the time we’ve both invested.  If you propose a reasonable compromise between our initial competitive price proposal and your counteroffer, I’ll take it to my finance people and see what I can do.”

Why a Former FBI Hostage Negotiator’s Approach Differs:

A former FBI hostage negotiator advocates for an alternative approach in his co-authored book, “Never Split the Difference.”  In the book, the co-author proposes that splitting the difference only sometimes serves a person’s best interests.  The co-author emphasizes using “tactical empathy, active listening, and calibrated questions” to uncover your counterpart’s true motivations and priorities.

In contrast to splitting the difference, the co-author encourages people to seek out “black swans” –unexpected and valuable concessions that might result in a more favourable deal.

At negotiatingcoach.com, we call this “Broadening the Scope” of the negotiation.  It’s important to understand when and how to properly split the difference in a negotiation.

Conclusion

While splitting the difference can be a quick and straightforward way to resolve negotiations and maintain relationships, it may not always be the most effective strategy.  Understanding the pros and cons of this approach is essential for any negotiator. There are alternative perspectives on this topic that challenge the status quo.

In your next negotiation, consider the specific circumstances and your counterpart’s motivations before deciding to split the difference – or aim for something more.  Remember, successful negotiation requires a versatile toolkit of strategies and tactics, and the right one depends on the situation.


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