The Art of Negotiation: Learn it and Make More Money!

"Mom, I think I want to be president," Connor said.

"Is that so? I thought you wanted to be a professional baseball player," I replied.

"No, not when I grow up..." he explained. "I want to be president NOW."

That's right! Connor, my 10-year-old, was nominated for class president. He had 24 hours to think about the responsibility of this prestigious position and either accept or decline the nomination.

After my husband and I spoke to him about what he thought his duties would entail and the commitment he would undertake, Connor decided to go for it.

When he asked me to help him develop his platform and help him write his speech, I asked him what he believed his strengths were and where his experiences lie.

Connor started with his grades. He said that since he is a straight "A" student, he can help other kids develop good study habits. This is both logical and irrefutable.

Next, he commented on the fact that he does not think it is fair that when boys play games, they often refuse to let the girls play. Under his "presidency," he wants to make sure that all kids get a fair chance to play. This is not only smart, it is also an emotional trigger that will likely resonate with his classmates.

Finally, he said that his experience as a middle child has allowed him to become a good negotiator. He feels that he can help his classmates resolve issues they have with each other.

Bingo!

I was pretty impressed that at 10 years old, Connor has already figured out that negotiating is one of the most important skills a person can master.

This is true in all aspects of life. But it is absolutely critical in your day-to-day business activities.

Yet many women lack this crucial skill.

In fact, studies show that by neglecting to negotiate their starting salary for a first job, women sacrifice over three quarters of a million dollars in earnings by the end of their careers.

But that's not all. Additional research reveals that men are four times more likely to ask for higher pay than women with the exact same qualifications.

Unfortunately this trend continues with women who start their own business. Their lack of negotiation skills... or discomfort with negotiation... or refusal to negotiate comes into play when finding office space, hiring employees, dealing with vendors, working with partners, creating joint ventures, and more.

For some reason women simply don't ask. They don't ask for raises and promotions. They don't ask for recognition for the good work they have done. They don't even ask for help at home with household duties and childcare.

Why is this?

For a long time, being a top-notch negotiator was regarded as something a man did. Some women viewed it as slimy or adversarial.

But I for one, can tell you that being a top-notch negotiator was unquestionably a major factor in earning huge salaries and acquiring company equity - and fringe benefits to boot! - for years as a corporate CEO.

These skills proved just as useful when starting my own company, in dealing with everyone from joint venture partners to building owners to service vendors and more.

If you feel like you aren't a good negotiator or just don't know how to negotiate, I'm going to show you how.

But first, I want to be sure you understand a little-known secret...

Negotiating Is Good Marketing in Disguise

Most of the principles that apply to marketing also apply to negotiations. So it stands to reason that if you are a fairly good marketer you will be a fairly good negotiator.

Likewise, if marketing is not your strong suit, you may need some help in the negotiation department.

Let me give you the top techniques I've used to negotiate game-changing partnerships... amazing salaries, bonuses, and benefits... and much more...

The 7 Core Principles for Million Dollar Negotiations

1) Determine your desired outcome before you start your negotiation. It is critical to understand what you want before you ever set foot in a negotiation. That way, you'll know when to push forward and when to stop. Knowing your bottom line prevents you from taking advantage of the other person in the negotiations (See Principle 7 for more on why this is a bad idea!)... And it also prevents you from agreeing to terms that are unacceptable to you.

2) Know your audience. This is by far the most important principle in marketing and in negotiating. Make sure you do your homework. Find out as much as possible about the person sitting across the table. Find out about other deals he has made. Understand if he is a handshake kind of person or a long contract kind of person and prepare yourself accordingly.

3) Understand your worth. The biggest mistake I see employees and entrepreneurs make is not understanding what they really bring to the table. Make sure your accomplishments are ingrained in your head. But also make sure that they are accurate and consistent.

4) Listen, listen, and listen some more. Most of the time we are so busy making sure that people hear what we have to say that we forget to listen. But the best negotiators are detectives. They ask probing questions and then stop talking. The other negotiator will tell you everything you need to know - all you have to do is listen. Many conflicts can be resolved easily if we learn how to listen. You can become an effective listener by allowing the other person to do most of the talking. Follow the 80/20 Rule: listen 80 percent of the time and talk only 20 percent of the time.

5) Lead with optimism. Aim high and expect the best outcome. Successful negotiators are optimists. If you expect more, you'll get more. A proven strategy for achieving higher results is opening with an extreme position. Sellers should ask for more than they expect to receive, and buyers should offer less than they are prepared to pay. People who aim higher do better. Your optimism will become a self-fulfilling prophecy. Conversely, if you have low expectations, you will probably wind up with a less satisfying outcome.

6) Never threaten and don't get emotionally involved. One big mistake many amateur negotiators make is to become too emotionally attached to winning. They shout, threaten, and demand to get their way. This is all counter-productive. Most deals are only possible if both people feel they're getting something out of it. If the person across the table feels attacked, or doesn't like you, they probably won't back down. Most people hate bullies, and will be more willing to walk away from a transaction if it involves one. Be calm, patient, and friendly, even if the other person starts losing their cool. Make sure you leave any pride or ego at the door. You're much more likely to do well that way.

7) Never walk away feeling you "pulled one over" on someone else. Many people try to drain every last drop of blood from a negotiation. This is a mistake. If the other person feels they've been cheated, it can come back to bite you. They may not fulfill their part of the deal. They may refuse to deal with you in the future. They may even spread the word to others you might want to negotiate with. Negotiations should leave both parties feeling satisfied with the outcome. Be willing to give up things that don't really matter to you in order to create a feeling of goodwill. For example, if you are re-negotiating your office rent downwards, try to offer to sign a longer lease. That way, the landlord knows his property will have tenants for a longer time, and you get a cheaper rent.

The ability to negotiate successfully in today's turbulent business climate can make the difference between success and failure. It is a skill you must master. If you keep these seven strategies in mind each time you step into negotiations, you will be well on your way to earning a better income, eliminating frustration, and having a more satisfying life.