When your customer or client says NO, what do they really mean? If you don’t have the skills to figure out how this response may really be a yes, you might miss a great opportunity to make a sale.
From an unskilled perspective, hearing the word “no” is percieved as being a final boundary in the negotiation process, when in fact, it can open the door to better outcomes for both parties.
According to negotiation experts Don Hutson and George Lucas, authors of the best selling book, The One Minute Negotiator, the word “no” is often the gateway to a completely positive outcome if the sales person handles the next steps with skill.
We must keep in mind that when there is a negotiation in process, there must be a common interest to trade, but most likely there will be some conflicting interests before getting to the cooperation stage. In the case of real estate, a property price sets up the conflict between what the seller wants (perceived value) and what the buyer is willing to pay. The real outcome is that both parties are in a bargaining situation and each with an objective to reach an agreement of “how” to cooperate, price being only one of many possible outcomes. However, both prefer an outcome in their favor. How intensely each party is willing to work through the bargaining process will determine who is effective in getting their needs met.
When negotiating, here are some pivotal issues that can help you go from NO to YES:
- Consider that time and urgency are key factors. If a seller can close in any timeframe, but the buyer must close by a certain date, there is more of an urgency on the part of the buyer. Since the buyer has more pressure than the seller, the buyer may be willing to pay more for the convenience of timing, rather than be fixated on the price for the property. Getting the property closed in a time frame that meets the buyer’s deadline is more critical to that buyer than for the seller and becomes a mutually beneficial outcome for both parties.
- When a seller is fixated on price, reducing the numeric disparity to a daily amount can help the seller understand the consequences of holding out for a larger sum. If a seller states that they won’t sell for less than X dollars, they are in fact saying NO to any bargaining situation. Smart agents will break the differential down over a period of time, and then show how that disparity can be recovered on the future purchase of a larger, more suitable property, or how a delayed closing will cost them more money. Another factor to present is the value of selling a bit lower, but how the seller would recover by buying their “forever home” from another seller in the same type of situation. Timing, impatience, surplus or lack of inventory will affect your seller’s outcome, so be sure to educate the seller on multiple options even though they seem stuck on “NO”!
- Many times a party will say the word “no” just because they are responding under pressure or panic during the negotiation process. As an example, a seller is asking $275,000 for their property, and the buyer comes back with an offer at $200,000. The seller says “NO WAY” but in reality, all that has really been done is that the parties have set the negotiating the range of $75,000. Smart negotiators will recognize that this is a sign that the game is on and just the beginning of the bargaining process!
Don’t shrink just because one party says no. Remember that they may really be simply saying YES, but not quite yet!
What is your initial response when your sellers say “NO WAY” to a low offer?