in Blog by Secure Investments Realty

How to Create a Win-Win in Negotiation

NARPM* 2015 Convention Workshop: Negotiation for Property Managers

Speaker: Tom Sedlack, MPM® RMP®, 33rd Company, Inc., CRMC®

During this workshop. Mr. Sedlack presented negotiation tactics to help property managers and any business professional learn better methods and techniques for successful negotiation. We have included his powerpoint presentation below with our notes. Enjoy!

Click here for Sedlack’s Powerpoint Presentation

Negotiation Basics

“In business as in life, you don’t get what you deserve. You get what you negotiate” -Karrass
Key question in every negotiation: WHAT DO YOU WANT??
Negotiations add up over time that is why you need to maximize returns in your negotiations.
You are trying to shape view points and leverage your knowledge during negotiations.
Savvy negotiators design the game in their favor before they get to the table; they don’t just play the cards they have in their hand.
Good negotiators manage people, processes and sequences.
You need a solid foundation to design the game in your favor:
- Design good contracts based on experience and know them well (only want customer service issues)
- Pick good properties, owners, tenants (you need to publish screening criteria on your web site and avoid bad properties)
- Use good communication
- Build and keep a good reputation in the industry
- Create a “Trust page” on your web site which outlines your ethics and standards for the company
You can only control your behavior! Use that to your advantage.
There are only winners in a negotiation. See it as collaboration.
Be gracious and understanding no matter what. It changes your reputation.
Game Theory: Is it rational to cooperate for a mutal gain or is it better to look for individual gain and win at all cost? Using a “tough guy” game is not very successful. (see powerpoint presentation for proof)
- The medium strategy is successful the majority of the time: How do you find the medium strategy to negotiate?
Go after their interest – not their position but what they are looking to gain.
Everyone has different interests, needs, & priorities.
Some competitors want to contribute to the industry; others just want to take from it.
Property owners are clients you serve and you should be fixing mainly service problems
Tenants are customers. Your relationship should be product and rights-based.
It is HOW, not just what, with words.
Honesty doesn’t mean full disclosure; never lie about your interests, needs, and priorities but be careful what you disclose.
To help with negotiations: create overlap! Try and make the desires more similar for both sides
A concession without reason is of no value (example of a concession: I give you 5 I give you 4 etc.)
Principles concession is one with rationale. Ask why? Whenever they ask for a concession. When making concessions yourself, tell them why you are doing it as well so it sets the standard.
Create a negotiation tracker so you can see them add up.

Legal Negotiations:

Attorneys tend to escalate and expand issues. It is not wise to completely delegate to an attorney.
Think of an attorney as an employee and not the leader of the team.
Use a win-win approach to reduce fees and improve outcomes.
Unpaid rent judgments: Tenants have incentives to pay in full. If they don’t pay, you are no worse off and have a full judgement. Just pound a large stack of documentation on the table in front of them to prove your point that you have everything you need for them to lose their case.

Five Steps to Successful Negotiation:

Good planning/foundation – plan ahead!
Understand your opponents needs, interests, and principles.
Use an established process – always look at the worst scenario for a legal issue by the dollar amount so you know not to freak out.
Make the pie bigger – it isn’t always about the money. Look at other interests; create a win-win; maybe give them a credit and ask for a good review in return.
Lock it down in writing.

Biggest Mistakes: