A632.4.4.RB - Deception in Negotiations

Negotiations are actually more common then you think. Negotiations are a part of every fulfillment of a new job, they are even often a part the process of selecting a dinner venue for families and couples. Whether in the professional work space or not, negotiations are important, and knowing how to properly negotiate is critical. A little under a year ago my boyfriend and I made an offer on a house, included in that offer was a request for the tractor that the owners had on the property. In the owner’s comeback offer they disclosed that they would accept the “tractor” request, but they specified that it would be for the smaller and older tractor that was locked in the shed at the time that we viewed the house. Additionally, the home owners offered the tractor, that we had originally requested, at an additional twenty thousand dollars. Just as our text states, negotiators are more likely to use a hardball tactic in their negotiations (Hoch, Kunreuther, & Gunther, 2001). Instead of budging on the price the house owners built their reputation within the negotiation as being flexible and offering an alternative tractor, but also playing a bit of hardball by offering the original tractor as an additional cost.

I would say in this scenario we both were misled by the home owners in thinking that the newer tractor could be a part of the deal, and we overstated the claim as by requesting the tractor there was a surplus in value requested from the owners. With the house only being on the market for 1 day before we submitted our offer the homeowners certainly had some leverage on us, but this timeliness could also have to do with us feeling a bit misled in the process. Additionally, we certainly overstated the claim and the leeway in our own budget in revealing that we were interested in the tractor.

In the end of this negotiation we decided to just bring the price down and forego the tractor option. In doing so we ended up agreeing upon a price with the owners and we have happily lived in our new home for just under a year now. Negotiating is quite a strategic dance, one that with one misstep potentially costing you the deal. Negotiations is all about leverage, reputation, and strategy, and when navigated appropriately negotiation can lead to some great outcomes, even for all parties involved.

References

Hoch, S. J., Kunreuther, H., & Gunther, R. E. (2001). Wharton on making decisions. Hoboken, NJ: John Wiley & Sons Inc.