I fell in love with the look and style of the Nissan Murano about 15 years ago. You should know that I’m not a car guy. I look at vehicles from an economic utility perspective – get me where I need to go in a fiscally responsible way. However, the shape, style and features of the Murano seduced me.
While I may have been seduced, I had not lost my fiscal sense. I searched for information about the SUV and the value of buying a used one. A dealership a few miles down the road from my work that was offering a late year model. It was low mileage and black for $21,000. I printed the webpage and headed down to the dealership.
A zealous salesperson immediately accosted me and was thrilled at the prospect of helping me find the car of my dreams. I asked him if he had the Murano still in stock and in about 90 seconds, Mr. Zealous was screeching tires and ready for a test drive. The car passed my road test and we went into the office to talk price.
Mr. Zealous met me in the office with a worksheet and said, “Good news. The Murano is available for only $22,000!” You might remember from about 20 seconds ago that I was holding a paper that read that the Murano was on sale for $21,000. How did the car go up in price between my office and the dealership?
He told me that the internet offer expired. (By the way – I didn’t see an expiration date on the internet offer) Then, he asked me to wait one minute. A minute later, he came back with even better news. He could get me the Murano for $21,000 if I was willing to do the paperwork today.
What I did next is something most car buyers should consider doing. It is something so basic yet most are intimidated to try. I stood up. Thanked Mr. Zealous for his service and walked out of the showroom.
Welcome to Swimming in the Flood; a podcast where we develop the resilient leader’s mindset by navigating difficult currents in business. My name is Trent Theroux.
Sir Frances Bacon writes in his Examples of the Colours of Good and Evil, both Simple and Comparative, “That which keeps the matter open, is good; that which leaves no opening for retreat is bad. For not to be able to retreat is to be in a way powerless; and power is good.”
I encourage every listener to write that passage onto their cell phone’s notes field and read it the next time you go to purchase a vehicle. “For not to be able to retreat is to be in a way powerless.”
Too often, I listen to negotiations happen in absolutes, whether it is between customer and provider or employer and employees or partners. Too often, I see people make two critical mistakes. First, they reduce the negotiation down to one item, mostly price. Second, they bring the negotiation to a take it or leave it position. These two items will leave both parties less well off than better.
For right now, I’m not worried about your negotiating partner. I am worried about you, my constant listener. The challenge with reducing the negotiation down to price and/or having a take it or leave it position is that we most often don’t want to back down. We want to win. We believe that negotiating is a sport, with a scoreboard, that flashes across the ESPN ticker. Trent 14, vendor 6. Highlights at eleven.
There is a better way to achieve the results you want.
I am now going to give you my unscientific, non-peer reviewed, resilient leader theory on competitive negotiating. Are you ready? Got your pencils out? Here’s it is. Don’t Jump In The Well. You heard it. Don’t Jump In The Well.
The theory is simple. Here’s how it works. Aesop’s fable The Frogs and The Well inspired this theory. The fable reads, two Frogs lived together in a marsh. But, one hot summer the marsh dried up, and they left it to look for another place to live in: for frogs like damp places if they can get them. By and by, they came to a deep well, and one of them looked down into it, and said to the other, “This looks a nice cool place: let us jump in and settle here.” But, the other, who had a wiser head on his shoulders, replied, “Not so fast, my friend: supposing this well dried up like the marsh, how should we get out again?”
The moral of the fable is to think twice before you act. Frances Bacon would think the moral differently. Perhaps, “For not to be able to retreat is to be in a way powerless.”
Mr. Zealous watched me walk out of his office and came chasing after me. “There’s been a mistake. Let’s see if we can work this out.” I am sure there was a mistake. I told Mr. Zealous, “I am willing to pay $18,000 for that car today. “Whoa! I’m not sure I can do that deal. I’ll have to talk with my sales manager. Can you wait in my office for a few minutes?” “Sure.” I said, ‘But, here’s the other part of the deal. Every time you leave me in that office, I am going to reduce my offer for the car by $500.” Mr. Zealous nodded and took off for the sales manager.
I am going to assume that we all have sat in the sales guy’s office waiting for him to work out our deal with the sales manager. A salesman once told me that he was going to have to fight his manager, but he was determined to win. Another salesperson told me that the sales manager was in a good mood that day and it means it should be a good day to buy a car.
My salesperson today came back into his office, grabbed a sheet of paper, wrote down the number $20,500 and passed it along the table to me. He barely budged off the fake internet price. I looked at him, took the piece of paper and wrote down $17,500. Then directly below that I wrote $17,000. “What’s that for?” He asked. “Well, $17,500 is my offer to buy the car right now. The $17,000 represents my price when you leave this office to discuss it with your sales manager. Mr. Zealous ripped the paper off the desk and left the office.
Here is where the psychology of purchasing a car enters. Have you ever felt like you had to buy the car? Like you invested all this time and it’s really only a couple thousand dollars stopping you from getting that great new machine? You know that I am not a car guy, but I can get caught up in the seduction of purchasing a new car just like the next person. When you feel this compulsion to capitulate please remember our theory Don’t Jump In The Well. In all negotiations, you should have a plan for escape. A way to retreat. Remember, no deal is always better than a bad deal.
Mr. Zealous returned about ten minutes later with his slip of paper. He wrote down $18,700 and said that was the best he and the sales manager could do. I looked at his number and thought about the research I did on the value of Muranos. I thought about the cost in time and energy to get to this point with the dealer 15 minutes down the road. Walking into this dealership, I was prepared to pay $19,000 for the car.
In my pocket was my retreat. I had an internet offer for the same year Murano at a dealership about 15 minutes away. I didn’t need to jump into the well right here, right now. I retained my power because I left myself a way to retreat.
Ultimately, I bought the car right there. $300 ahead of what I was willing to spend. Albeit, severely stressed out and with a few new gray hairs. Competitive negotiating does that to people. Driving away, in my new car, I realized that maybe my gamesmanship wasn’t wholly fair or ethical. Then again, maybe he would have sold me the car for eighteen-five. I’ll never know. In the end, negotiating is about how you feel about the value you accepted.
Folks, thank you for listening to Swimming in the Flood. Resilient leaders face challenging currents and it is tough navigating, but with one tack or another we can get there together.