Letters from MBA

Negotiation - 1st round

[Process]

1. proposal of seller’s price
2. proposal of buyer’s (me) price
3. negotiation from the perspective of amortization of the value of the properties by buyer
4. negotiation from the perspective of inflation of the value of the land by seller
5. ~ remaining as far apart as ever
6. compromise from seller without clear reasoning (still exceed the buyer’s criteria)
7. compromise from buyer with clear reasoning (little bit exceed the buyer’s limitation, but not unacceptable)
8. ~ refusing any other proposal from seller with the clear reasoning
9. agreement at seller’s proposal with one provision that does not have impact on buyer’s business

[Takeaway]

• Preparation is important, especially making target and minimum/maximum point supported by quantitative logic is effective
• Should pay attention to counter party’s attitude, which is whether he/she really wants to sell or does not need to so; for example, compromising by little and little shows a counter party’s willingness to sell/buy
• Shutting down is also an option, but, before doing so, should clarify the criteria
• Ask “Why are you selling?”
• Discuss other aspects - create value “win-win”, think outside of the “Box”

[Peer feedback]

• Remained unemotional - didn’t let emotions get in the way 
• Wanted to keep going even when it seemed we were at an impasse 
• Tried approaching the problem from several different angles
• At times I felt that my reasons weren’t being valued simply because they were qualitiative - going forward it might be helpful to listen for and acknowledge the underlying interests.