Dear Santa…
What are tradeables and how do you use them in a negotiation?
Resigned yourself to the fact that it’s a satsuma and a boiled sweet in your stocking again this year? If so, what’s stopping you from being a bit more ambitious?
Read on to find out how to use tradeables (also known as “Variables” or “Negotiables” in your negotiation. Using these can help you avoid deadlock, protect and create value.
As we approach the holiday season, it’s that time of the year when some of us are writing our Christmas lists in the hope (and dare I say it, expectation) that we’ll be adorned with thoughtful gifts from friends and loved ones.
I don’t know about you, but I find this a really challenging time, because it means I need to listen (or to HAVE listened throughout the year) to the subtle hints from my wife about the gifts that she’d like. I swear that I try really hard, but I never seem to pick up on the “coded messages”.
This has resulted in brief, veiled appreciation, followed closely by predictable disappointment over the last few Christmases.
OK, I lied there. It’s been every Christmas.
I genuinely thought the shapeless purple fleece was going to be so incredibly practical.
As for when I carefully selected (read: “bought last minute”) the illuminated mirror of last year – I thought that was a “game-changer” that would bring untold joy. I was mistaken.
Regrettably, I think that this year my wife will share a web link to her wish-list with me. This obviously deals a crushing blow to any surprise and mystique as she unwraps my gifts to her, but the upside is that it’s the panacea for delivering exactly what she’d like. 100% OTIF. What could possibly go wrong?
But if my kids are anything to go by, then this group in society have wish-list writing down to a fine art; they’re specific, address their interests and are always ambitious.
Anyone who negotiates should take note from the kids here. Let me explain why.
When you’re negotiating over a single variable (price, for example) if neither party is prepared to make any concessions, the negotiation can become deadlocked pretty quickly.
The best negotiators will therefore introduce multiple “tradeables” to keep the wheels of the negotiation turning – to keep it moving forward towards finding a mutually satisfactory solution and grow the value from the negotiation for both parties.
Tradeables (also known as “Variables” or “Negotiables”) comprise 2 components:
1. Wish-list – items of value that the other party has, that you would like, sometimes called “takes”;
2. Concessions – items of value that you have and the other party wants, that you are prepared to concede, called “gives”.
Your wish-list needs to be full of things you’d like that bring value to your business. Get creative and brainstorm with your colleagues to uncover these items of value that you’d like from the other party. You’ll be amazed at what you can come up with when you really try.
Be ambitious – what seems like an outrageous request to you may be entirely reasonable from the other party’s perspective. Equally, there could be several smaller items of value to you that the other party could readily concede.
Some examples could be: access to new technologies that the other party has, access to dedicated resources, vendor managed inventory, shorter lead times or joint working groups to tackle process simplification. There could be dozens more that are relevant to your business.
Similarly, get creative with your list of concessions, too. Think about what’s valuable to the other party that you could trade at low cost to you.
Some examples here could be: improved payment terms, introductions to new business units within your organisation, providing references, providing referrals, twice-yearly meetings with your leadership team. You get the picture.
Using tradeables in a negotiation will allow you to both protect and/or provide value, will enable you to strengthen the relationship with the other party and are more likely to get you what you want, more of the time.
If you think I could help you increase the negotiation capabilities of your team, please get in touch.
The best days lie ahead
