Li

Lipsey School of Real Estate2011 Systems for Success

Presented by

Mike Lipsey, MCRE

Module 10 Negotiation10.1….....................................Negotiating Tactics 10.2………………...……............Settlement Range10.3…………….…………Strategies for Leverage10.4……………………………….…Closing Tactics

Module 10: Negotiation

Negotiating Tactics

Big Pot / Overload

The Bogey

The Bone

Car Salesman

Cherry Picking

11th Hour Squeeze

Emotion

Ice Pick

The Nibbler

The Note Taker

10.1

Tactic (Big Pot / Overload)

Big Pot / OverloadAsking For More Than Expecting To Receive

NeutralizerEstablishing Most Specific Need (What Do They Really Want?)

10.1

Tactic (The Bogey)

The BogeyTrading Emotions For Economics “I love you, but..”

NeutralizerThe Mirror, “I love you too, but..”

10.1

Tactic (The Bone)

The BoneGiving Concessions Now.. “We have more business down the road.”

NeutralizerContracting for the Future Business, or Giving Credit.

10.1

Tactic (Car Salesman)

Car Salesman / Plateau NegotiatingCreating the Perception that your Receiving a Great Deal!

NeutralizerSee the “Wizard” for yourself.

10.1

Tactic (Cherry–Picking)

Cherry-PickingObtaining Bids from Several Area Competitors – Pick Best of all to Make you Compete Against Them.

NeutralizerAsk for Specifics and / or Present Your Features and Benefits

10.1

Tactic (11th Hour Squeeze)

The Crunch or 11th Hour SqueezeDelaying Completion of Contractual Finalization“They don’t sign the lease, they wait for you to give up more.”

NeutralizerEmpty Cupboard (There isn’t anything left)Moral Appeal (Prepare in advance for this)Reversal (What do we get in return – High Risk)

10.1

Tactic (Emotion)

EmotionThe Angry Parent

NeutralizerHumor (High Risk)Enter Your Angry Parent (High Risk)Don’t Get Hooked (Staying in your Adult State)

10.1

Tactic (Ice Pick)

Ice PickLeading you to believe that you are very close to the deal (Hidden Agenda & The Good Cheerleader)

NeutralizerDon’t get sucked in early (get notes prior to meeting) or “The Salami” (What else is on their mind before you commit)

10.1

Tactic (The Nibbler)

The Nibbler The Negotiation is Almost Done and they ask for one concession at a time over a period

NeutralizerMoral AppealGive and Take

10.1

Tactic (The Note Taker)

The Note Taker Intimidate by taking notes, takes your words out of context, selective listener

NeutralizerPutting Your Points in Context

10.1

Settlement Range

Opening Offer

Goal

50 Yard Line

Warning Area

Bottom Line

10.2

Strategies for Leverage (Hurricane)

HARM The side that can cause greater damage

UNDERSTANDING The side that understands deal points

RESOURCES The party with more time and money

10.3

REWARDThe side with more to offer

INVESTMENT The side that has invested more

CREATIVITY The side that can create more options

Strategies for Leverage (Hurricane)

10.3

ABILITY The side with more knowledge

INFLUENCE The side with more external forces

NEED The side that can lease afford an impasse

EMPHASIS The side who has assigned a higher internal

priority

Strategies for Leverage (Hurricane)

10.3

Closing Techniques

Trial Evaluate Prospects Standing Asking Opinions that Give Insight

Alternative Offering Two or More Alternatives Offering a Choice Between Something and Something instead

of Something and Nothing. (March 1st or April 1st)

Assumptive/Next Step Assumption Prospect Will Perform “Next Step?” 1st of March, If Not then When?

10.4

Erroneous Conclusion Intentional Erroneous Statement Prospect Correction, Walk Right into Sale (12% VS 14%

IRR)

Hard to Get It/Prestige Close “Landlord is Extremely Selective.” “Will You Qualify?”

Reduction of the Ridiculous Bridges a gap between willingness to pay and ability to

pay

Closing Techniques

10.4

Lost Sale/Door Hanger Pretending Presentation is Over While Prospect is Processing, Asking for Suggestions to

Improve Your Presentation Once Identified, Reexamine Hot Buttons

Order Form Fill Out Contract Indirectly Closing Prospect

Mirage (Fantasy Picture) Building a Picture of What Could Be.. This is Where You’ll Put the Kitchen.” Similar to Assumptive Close

Closing Techniques

10.4

Puppy Dog Invitational Close Prospect Experiments with a Product, Returns if

Unsatisfied

Sharp Angle “If it wasn’t for (x) Would You Move Forward?” Handle’s Smoke Screen Objections

Close with Emotion Identify the emotional aspect of the sale Make a strong emotional appeal with that information.

Closing Techniques

10.4

Summary Summarizing Benefits that Meet Client’s Needs

Ultimatum Issue your final proposal. Deliver with confidence and strength This sale will not make or break your career.

“Yes” Momentum

Ask questions that require the prospect to answer “yes.”

Use this momentum to conclude your sale

Closing Techniques

10.4

Similar Situation Similar Former Client With Similar Objection Sharing How you Resolved Conflict

Denominator Close Breaking Financial Terms into Components Total investment, Monthly investment, or Initial Investment

Hot Button 80/20 Rule (80% of Buying Decision Based On 20% of Product’s

Features) Establish Hot Button, Push Hot Button

Ben Franklin/Balance Sheet List of Pros and Cons Many Reasons Why, Few Reasons Why Not

Closing Techniques10.4