Negotiation 101-what I learned at the wet market

The propensity and power to successfully negotiate shows up early in life. Ask any parent whose argument against buying that particular toy has been mercilessly dissected by the patient, well-reasoned logic of their 6 year old child if you have any doubts. The practice of negotiation is older than Methuselah and is used consciously and unconsciously almost every time we speak to one another, whether to buy something, to borrow something or even to beg something, such as those generally unfruitful efforts with the traffic police. The story line is pretty much the same in any case; one party wants something that the other party has the power to provide, and both parties want the final deal to favor their own interest. Even that sacred act of marriage is only consummated after a usually tough round of give and take.

Most successful negotiators will be the first to tell you that good negotiation is
more art than science, and the act of negotiation is as good of a test of your character as any other. Emotions, ethics, empathy, tolerance, patience, perseverance, honesty and prepared are words that I most associate with negotiation. And while there are tomes of books and thousands of seminars that promise to teach you negotiation skills, my own experience and observation is the best lessons in negotiation can be found in Asia, and there are no better teachers than the hordes of housewives who daily browse through the wet markets to buy fresh vegetables for dinner. Lets take an imaginary trip along with one such housewife and I think you will get the picture.

First, there is a very clear objective or preconception of what will happen. Vegetables are needed for dinner. The household favorite is spinach and that is what she looking for, but there are other vegetables that are also good, so if the spinach is not fresh or the cost is too high, kale or broccoli will do just as well.

Next is to consider how much time she has to buy the vegetables. The day is still young but she doesn't want to spend more than a couple of hours at the market, and lots of this time will be used up already chatting with friends and neighbors. Of course some of this chatting will be talk of who has the freshest and least costly spinach today.

Now she needs to decide where to buy the spinach and she needs more than one option to get the best deal. She already knows where to find the freshest and most tender spinach from her chatting and browsing.

OK, here it gets more difficult. She needs to determine what the other party expects or needs to complete the deal; in this case, what price the farmer is willing to sell his
spinach today. Of course this is never easy because she doesn't know how the farmer's day is going, and she has never bought from farmer "A" before either, so she is not sure how is his style, but needs to find out. The conversation probably goes something like this:

Housewife: Those are nice carrots you have, how much are they today?
Farmer A: These are the best carrots in the whole county. I want you to buy them so
I give you a special price of only 5 Yuan a bunch.
Housewife: Oh! That is so expensive. I can buy them over there for only 2 Yuan.
Farmer A: But those carrots are not as good as mine. But you are a nice lady and I
want you to buy my carrots so I will give you a special price of 3 Yuan.
Housewife: Oh! Still too expensive!
Farmer A: My carrots are the best. It cost me 2 Yuan to grow them. The best price is
already to low! But, if you will be two bunches I can give you a small discount, 5 Yuan for both.
Housewife: Hahaha! You are a robber instead of a farmer, still too expensive! How
much is that spinach you have? Is it made of gold also?
Farmer A: The spinach is same price as carrots.
Housewife: Golden carrots and golden spinach! Ai Yah!
Farmer A: Ok, you seem to be a nice person and I want you to buy my carrots. How
much can you pay?

The housewife then walks away with disinterest, generally with the farmer still asking,
"how much you will pay, what is your price?" The savvy housewife will say nothing of
course, as she is not yet ready to buy, and by doing nothing, she has remained flexible in reaching a deal. She has however established her bottom line indirectly to the farmer when she claimed to be able to buy at the price somewhere else. This process is repeated at the next stall, with variations of course, unless there is some clandestine "farmer cartel " operating in the background, until the housewife has determined as best she can which farmer is likely to give her the best deal.

Notice she has not yet committed or even hinted at her bottom line, but she has gotten a very good sense of each farmer's bottom line and style of negotiation. Now it is time to buy the spinach and go home. Farmer A seemed eager to sell his carrots and his spinach was pretty good, so back to Farmer A's stall.

Housewife: You seem rather slow today so maybe I will buy some of your carrots and
maybe some spinach too. I will give you 3 Yuan for one bunch of carrots and one bunch of spinach. Ok?
Farmer A: Hahaha! I can make no money at that price! It is getting late so just for
you, I give you both for 4.5 Yuan.
Housewife: Here is 3.5 Yuan in my hand. Take it and give me the vegetables.
Farmer A: Oh, too cheap! Give me 4 Yuan.

Our outwardly irritated housewife begins to walk away and, as she has expertly
calculated from their earlier exchange, the farmer shouts back, " Ok, you are cheating me but I give you both for 3.9 Yuan to save me from having to cart them back home." The housewife comes back then proceeds to find a blemish on 1 or 2 carrots, and after another mildly heated discussion with the farmer, walks away with a bunch of spinach for only 1.9 Yuan.

In reality both parties are reasonably satisfied or the deal would not have been concluded.

Global arms treaties, corporate takeovers and divorce settlements aside; this rather simple exercise teaches the most important fundamentals of negotiation. The interesting but seldom practiced fact is that all things in life are negotiable if you know what you want, make sure you have suitable options, invest some time to carefully study your options, gain an understanding of the other parties needs and are willing and able to walk away if your bottom line is not reached.

Beats shopping at Wal-Mart doesn't it?