Negotiating Tactics – Freelancer Tip

A little outside of the SEO strategy topics but I felt it a worthy topic. Negotiating is an inevitable occurrence when either offering services or hiring a freelancer. I personally hate “sales” and wouldn’t claim to be a “salesman” but nonetheless I have to be if I’m offering a service.

My golden rule in negotiating anything comes from an experience with my father when I was 18. I wanted a car and I found it at a dealership in town. I’d never bought a car before so my father came with me. The lesson he taught me was priceless.

Ultimately in almost any negotiation the party that feels the most confident in their position will begin to press concessions on the other. Often if one party concedes that demonstrates their inferior position and signals to the winning party … to do it again, and again … until you’ve created the best deal possible for you. The trickiest part in this process is that the conceding party may continue to concede because in their mind they’ve already given this much … why let it all go if they just need to give a little more.

In my car experience, the first issue was me. My credit as an 18 yr old wasn’t much so the dealership asked my father to cosign. He had excellent credit and would have been able to walk off the lot with anything they had. After some thought, he agreed. This was the first concession, he went from advisor to being a party to the transaction.

They then came back and provided us financing based on my credit, I cant recall now but I think the interest was like 15%. Dad objected noting his credit and being a cosigner should mean we get the financing he would have closer to 4 or so percent. They disagreed noting I was the buyer … but if he wanted to be the buyer then he could without me.

Thats when he leaned over to me and said “You can’t let them think you can’t walk away.” So he did. It was actually really dramatic, Dad just got up and headed for the door. The salesman calling to him, the finance manager (the people you never speak to who are sitting near and that your salesman keeps running over too) jumped up and started to move to cut him off … but Dad was too fast and the manager caught me instead.

He asked whats wrong? I said “He said that you’re selling him my car as if he had the credit of an 18 yr old.”

Whats my point?

Moving The Goal Post

The goal was to buy the car. In the example above the goal post was moved, more than once. This tactic tends to lead to a a process where the one moving the goal posts forces the other party to accept that they are not good enough for the original goal. Concessions must be made and as concessions are made, the position of the weak party gets even weaker.

In my own dealings I’ve seen this play out in negotiating sales. Giving away that you want or need this sale to happen weakens your position. I was selling 20+ servers to someone and they came back to me with an offer much lower than what I’d spent in the previous 4 months on the servers. But I thought, its easier to sell 22 servers to one person for less than to sell 1 server to 22 people for more. But I think accepting their low ball offer set the stage for the moving goal post.

We agreed 50% before the shipment, then 50% after they tested the servers. After I accepted, you’d think that the deal was done. But it wasn’t, instead the buyer wanted to setup the pickup of the servers. That usually comes after buying them but I agreed, this took a day or so of back and forth…I offered my availability and the first option presented was outside of that window. I also took 12 hrs to reply to that pickup time, and that lead the buyer to cut off the discussion until the next week.

In my mind, it was a tactic … to demostrat their position over me in delaying the sale. It was just a pickup after all, seemed like an easy step in the process.

Then the buyer said before shipping could be agreed too he needed to know that I had all the servers packaged on a pallet and ready for shipment. This meant, before he’d put in any effort he needed me to complete all of the effort needed from me. That also would limit my ability to back out or seek other options.

The goal post was moving. Before the sale could happen, I had to trust him to pay the other half later and he had to trust I would ship it. But that trust then erodes when shipment is required before payment and then before the shipment the packaging and removal of servers from alternative buyers had to happen.

These seem like small issues but they were a pattern and keeping in mind that a sale hadn’t even occurred yet it suggested that this would continue through to the point of receiving the other half of the low balled payment.

I responded that when buying a pizza, ordering a laptop or almost anything the seller doesn’t start making the pizza before the buyer pays or puts a method of payment forward usually. Cash On Demand is a payment form thats largely been left behind … it basically says, I’ll pay for something when I get it. The seller assumes all risk in this regard.

You’ve got to be ready to walk away

Originally we agreed, 50% payment, then shipment and testing, then 50% payment. But the goal posts were moving and in each time they served only one parties benefit. When you see this happening and find yourself making concessions … you have to ask yourself, objectively … is this what you wanted overall?

For me … it was less than I was seeking, it required me to trust that they’d still pay after receiving it, it required me to not consider any alternatives before any payment was made … each of these were adding in succession, not up front. That allows you to see it as only a small give on your part, but when seen all at once up front …. you may change your mind.

You have to be ready to walk away. They can’t keep adding criteria and you are only as weak as you consent to be in any negotiation. A novice negotiator may not know a good deal when they see it but if you think you’re getting a bad one … you almost always are correct.

Ultimately for my situation, I explained my position and then listed everything on eBay at a fair price. There are always alternatives and if you don’t feel like its a fair deal … walk away.

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