By Peter Karichu
Have you ever bought an item and later felt like you just got punched in the teeth when you realize how much someone else paid for the same item? That’s because you negotiated poorly, if at all.
The average person over the course of their life probably loses millions of shillings in all manner of overpriced purchases and poorly negotiated employment contracts. I too have been a victim of bum deals, ranging from mild extortion situations to outright bare-knuckled rip offs.
Interestingly, not many people realize negotiating as a skill they need to develop as part of their personal finance tool kit. Most of us stop at budgeting and investing.
This is because many people confuse negotiating with haggling. So they wrongly view negotiating as this uncool and pesky thing that a well-adjusted person shouldn’t do.
I see haggling as something you do where you are trying to get something for less than its value. It is essentially that noisy, cat and mouse chat you have with the mtumba vendor. I hate those ones (the bargaining sessions not the mtumba vendors).
On the other hand, a negotiation is when you are trying to obtain the fair value of an item or a service. It is not meant to be unjust or uncouth. It is trying to establish a win – win result for both parties. Negotiating for a better salary of a lower price is a cause for embarrassment for many people. But not only is this kind of embarrassment unfounded, it is also expensive. Following are points to remember to avoid getting gouged on your next deal.
Shut the freak up
You will often run into bad deals if you run your mouth during a negotiation. When you are buying a car and within the first 4 minutes you have told the seller everything including how much you earn and how many kids are going to be riding in the car, you are setting yourself up for a horrible deal.
Everything you say in a negation can and will be used against you, disguised as good intentions.
Say as little and remain as vague as possible at the onset of a negotiation. Don’t lay all your cards on the table at the first instance!
Instead, let the other party do most of the talking. Most people are uncomfortable with silence and will say something stupid in an attempt to address the awkwardness.
Negotiate price last
This sounds counterintuitive. What else will you be negotiating if not the price?
Well, some of the best negotiators never once mention a price. They let the seller negotiate themselves down to a price they are happy with.
When you name your price too soon, you are exposed. The other party will then manipulate your feelings about the item to prove to you that it’s more valuable than you offer.
Make the discussion less about the price and more about the characteristics of the item. Actually, act like you don’t care about the price.
When presented with the question of how much you expect to be paid at a new job, the instinct should be to ask some basic questions like; will I be required to work on weekends? What will be the scope of medical insurance? Am I allowed to take on personal projects on the side?
Apart from throwing the recruiter (who expected a figure) off balance, such questions give you the ability to draw parallels with your previous job which you can then use to tilt the argument in your favour. Also, it waters down the advantage the recruiter obtained by asking for your previous employment pay slips beforehand.
Maintain your poker face
Don’t be easily excited or impressionable. Don’t let your body language betray you or make it obvious you like something. I once had a negotiation trying to buy a car with a friend. Two square shouldered, dyed in the wool negotiators- that’s what we imagined we were. Then the seller mentioned a price that was way below what we thought we could pay for the car and I saw my friend’s eyes light up. You can be sure the seller saw our reaction. Obviously, it was impossible to make the seller drop the price by a penny after that.
Your default face should settle somewhere between disinterest and scepticism. It takes some practice to master but it’s a face worth a million bucks.
The person with the most options wins
When you have no options, you are at the mercy of the other party.
If you absolutely have no options, then it becomes even more important to master and deploy all the other “tools” above.
Also, remember that sometimes, human nature boxes us into situations where we become blind or unwilling to consider other good options that may be open to us. For example, when you are hell bent on buying a particular brand of phone while totally eschewing worthy alternatives. Establishing as many options as possible is essentially the magic pill for any manner of negotiations. The other person can usually tell when you don’t have alternatives.
Take your time
Believe me, unless you are negotiating a surgeon’s fees, nobody will die if the deal is not closed in the next two minutes. Don’t be rushed. Many employers nowadays play hardball by handing you a contract before you have any pay discussions thereby denying you any chance to negotiate your salary. While the suggestion may not work for junior level employees who are often times desperate for work, a good strategy to deal with this kind of underhandedness is to ask for some time to “think about it”. Don’t be surprised if the company calls you back with a revised offer after several days of your non-response.
Guest Opinion By Peter Karichu
