When we have something to sell, we end up working with a buyer sitting on the other side of the table from us. That person has one job in the world – use negotiation styles and negotiating techniques to get us to lower our price and throw in as many concessions as they can possibly get us to make. Our job, of course, is to resist what they are asking us to do. Buyers have tactics to get what they want and they’ll use them on us. We need to be aware of their tactics when they are used against us.
Two Ways Buyers Try To Get A Lower Price
When a buyer wants to get you to lower the price that you are trying to charge them, often one of the first things that they will try to do is to use a bogey on you. This is a simple tactic where the buyer will complement you, your product, and perhaps even your company. They’ll tell you that everything is wonderful and that they are in love with your product. However, it turns out that they only have a limited amount of money (less than you are asking for) and so they ask you if you could lower your price.
Another tactic that a buyer may use is called the seller bogey. This is when the buyer calls you up and says that they are not ready to start negotiating with you yet, but they need a planning price so that they can talk with their management and make sure that they have the budget that they need. The price that you give to them doesn’t have to be accurate, it just has to be in the ball park. Later, when you sit down to negotiate with them and your actual price is higher, they’ll come back to you and say that their budget is based on the lower planning price that you gave them and that that is the best that they can do.
Both of these methods are designed to butter you up. The buyer complements you and your product. You start to feel good about yourself and you start to believe that you are going to be able to close this deal. However, then they hit you with the one thing that is standing between you and closing the deal – your price. Their reason for doing this is that they believe that you will now scramble to lower your price just to be able to save the deal.
The Krunch Tactic
The final tactic that a buyer likes to use is called the Krunch tactic. This very effective tactic occurs when you make a proposal to the other side and they come back to you and say “you’ve got to do better than that”. In some cases they may tell you “you’re close”. What happens in this situation is that the ball is now in your court and the buyer expects you to lower your price.
There is one more way that a buyer can use the Krunch tactic. This is called the super Krunch tactic. This occurs, of course, after you’ve made a pricing proposal to the other side, they’ve taken a look at it and they come back to you and say “you’ve got to do significantly better than that”. The use of that one word, significantly, generally gets the buyer a much lower price.
The Krunch tactic is amazingly successful. One of the reasons that it seems to work so well is because more often than not we’re not all that confident in our pricing. We generally tend to think that our price is too high and when a buyer comes back and tells us the same thing it just confirms what we were already thinking.
What All Of This Means For You
As someone who is entering into a principled negotiation in order to sell something to someone else, we are up against formidable odds. The other side’s job is to get us to lower the price that we are planning on charging them and they have a vast array of tactics that they can use to make this happen. It is our job to be able to detect when these tactics are being used against us.
The buyer’s tactics often start out with using the bogey tactic. When this is being used, the buyer will complement us and our product but then they’ll tell us that they just don’t have enough money to pay us what we want to be paid. They’ll ask use to lower our price. A variation on this tactic is called the seller bogey. This is when the buyer gets us to commit to a “planning price” before the negotiations start and then attempts to hold us to that price when the negotiations are under way. Finally, there is the Krunch tactic where the seller simply informs us that “you need to do better” in order to get us to lower our price.
All of these tactics have been used by buyers for a very long time. The reason that they use them is because they work and work very well. As the person doing the selling in a negotiation it is our responsibility to detect when these tactics are being used against us. If we know what the other side is up to, then we’ll be better prepared to deal with them.
– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™
Question For You: When the other side says that they don’t have enough money to pay for our product or service, what should our response to them be?
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What We’ll Be Talking About Next Time
When we are negotiating with someone, we need to understand that in addition to a number of different negotiation styles and negotiating techniques they are going to be using tactics to get what they want out of the negotiations. As a negotiator, you need to be able to recognize when they are using tactics, you need to be able to identify the tactic that they are using, and then you need to know what countermeasures you can use to defeat their tactics. Wow – sure sounds like you’ve got your work cut out for you!