Distributive Bargaining
Effective when maximizing your own outcome when relationship is not important
Assumptions of Distributive bargaining
- Fixed resources to be divided
- One party gains the other party loses (win/lose)
- Interests are diametrically opposed.
- Over one single issue
- Relationship is not strong
- hardball tactics are normative and expected.
BATNA
What happens if I don’t make this deal?
Good BATNA
- More Value you can claim
- The more aggressive you can be
- Can anchor you in terms of what you belive is a reasonable outcome.
Reservation Prive
Least willing to accept. Try to learn the other side’s reservation price.
Aspiration Level
What you want to achieve.
Bargaining Zone
The zone between the two offers
Settlement Zone
Where settlement occurs, between the parties’ reservation prices
Information Gathering
- Generally do not want to disclose RP, BATNA
- Pattern of concessions may signal RP
- Pay attention to consistency.
- Watch body language.
HighBall/LowBall
Open with high price often can’t justify it
Intimidation
trying to intimidate the other party
Bogey
pretend that an issue is important when it is not.
Nibble
trying to get them to make a small concession or and the end of the deal you make a small request.
Chicken
making a threat of some negative action tiring to dare them into something
Good cop/Bad Cop
someone in the negotiation to be with you. (What parent to go to when you need something for this or that)
Flinch
Every time you talk numbers you act surprised at the number
Snow Job
the person comes prepared with a bunch of data to overwhelm you.
How to respond to hardball tactics
Ignore them
Discuss them
Respond in kind
Co-opt the other party before they use them
Dawsons Power Strategies
- Ask for more than you expect
- Never say yes to the first offer
- Always flinch when getting the first offer
- Play reluctant seller
- focus on issues
- Use vice “you’ll have to do better”
- Use a higher authority
Who should make the first offer
If you are uncertain about the value of the product
or service you are negotiating over, it is better to
have the other negotiator make the first offer.
Pattern of Concessions
- Get reciprocal concessions (if we do this what can you do)
- Never offer to split the difference
- Watch your pattern of concessions
