The Art of Negotiation

2010 was an awesome year; both of my schools grew at a rapid rate. As the schools grew, and the businesses matured, I encountered many sparring matches on the negotiation battlefield.

 If you are a martial arts school owner, it is important to be skilled in the art of negotiations, looking at each negotiation as a sparring match.

Each negotiation situation should be approached as if you were going to battle, you MUST be trained, prepared, and have a game plan. My most recent “negotiation sparring match” was another victory under my belt, where we ended up purchasing 1,000 square feet worth of mats.

My martial arts instructor and business partner Dion Riccardo (Sifu) cornered me during this match, helping me impose my will.  The negotiating techniques used in this match are universal, and can be applied to any purchasing situation. Here is a play by play of that match…

 “The Weigh Ins”

 It always helps when you have some background on your opponent when entering into a match and when negotiating, the same applies. I have made mat purchases in the past so in this case I already had a good idea on which company I was going to use.  If it was my first mat purchase I would have done my negotiations with several companies to determine which one I would use. Always start by going on to their website to see what specials they are currently offering, I was able to see that the mats were on sale for $1,820 for the 1,000 square feet that I wanted. The next step that I took was to sit down with my corner man (Sifu) and go over the game plan for the match that was about to take place.

“Round 1”

Armed with a game plan and pricing information I was able to begin my negotiations. I wanted to start the match on a good foot, so the first thing I said was “Hi Shawn I have bought mats about four times from you in the past…” this is gets our conversation off to a good start, kind of like bowing to your opponent before a match.

The next thing I said was “that I am calling to see how competitive your prices are.” This lets them know that I have not committed to ordering the mats from their company; I am just collecting information so I can make the best decision. This helps me dictate the pace of the fight, like a feint, putting me on offense Shawn on defense.

I continued my offensive attack with a jab, by asking how much would 500 square feet of matting would cost me? He said that the Internet price was $910, I let Shawn know that we are on a tight budget and plan on buying more mats in the near future. He then asked if I would be willing to put up a banner with his company’s logo in my school? I agreed, and with that said Shawn quoted me a price of $800 for five hundred square feet. I immediately asked “if that’s out the door including delivery”, and he respond with a yes.

I continued my offensive attack and asked if he could give a better deal on a different color mat? (In the past this attack worked and he offered an additional $50 for the red color mats.) Shawn said that inventory is pretty low in all colors so he would not be able to discount a different color. Before round one ended I asked one last question, “If I ordered them today when can I expect delivery?” This will give me all the information I need going into round two. After he gave me the timeline I thanked him for all the information he gave me and said I need a little more time to some checking and that I would call him back in about a half an hour.

In round one I developed a good relationship with my opponent and made a couple of attacks toward getting the price lowered. Before round 2 started, I double checked with competitors to see if they could come close to the price I was getting, none could. Now that I have my opponent where I wanted them, I was able to throw and land my knockout blow by negotiating the quantity in round 2…

 “Round 2”

When I called Shawn back I told him that his price seems pretty competitive, but what if we grabbed 1,000 square feet, would you be able to give a price break? BAM!!! This is like a round kick to the head; it seems to work every time! He quoted me $1,500 for one thousand square feet of mat, saving me an additional $100 from the price I got during the end of the first round and a total of $320 off the original internet sale price. I confirmed with him that the price included shipping and gave my credit card info.

TKO Victory! $320 (17.5%) knocked off of the internet sale price!

In conclusion:

The art of negotiation should be handled like a battle by always taking the time needed to do research and come up with a game plan.  Having patience and asking the right questions will give you multiple opportunities to get the price knocked down. Then always save the quantity discount as the last attack. Meaning if you plan on ordering 100 units of an item get the price down as low as you can for 50 units, and then ask for a price brake at the higher quantity.

I am grateful that I was taught these negotiating techniques; I hope that the techniques used in this negotiation will help you save money on your next purchase.

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