The Silver Rule of Negotiation

 Sep 03, 2014

It may be a scam but tourists in Cairo are told that the scents that are used in Parisienne perfumes come from the rare flowers of the desert and are extracted in Egypt and shipped in concentrate to France for their expensive Diors, Chanels and so forth. So any excursion to the pyramids finds you visiting a perfumery at some stage of the trip with a little ‘baksheesh’ (a non-disclosed commission/bribe) given to the tour guide. When it happened to me over twenty years ago, I didn’t have a girlfriend at the time but my travelling companion did so he started negotiating to get some perfume for his girlfriend who would be meeting up with us later in London. I had an ear out for the monetary amounts he was talking in and then, not to be left idle, another man in the store tried to convince me to buy something. Being a nice brother and son, I thought I might get my mum and sisters something as presents, so after choosing my scents, based on my friend’s figures, I low-balled the vendor and got howling protests from him. He moved up but I stayed firm, eventually walking out of the shop when he would not agree to my offer. I then had two Egyptian guys following me down the street to bring me back to sell me the perfumes at my original offer. This brings up the ‘Silver Rule’ of Negotiation: High Need = Low Power and conversely Low Need = High Power, which loosely translated means you are in the strongest position in a negotiation when you can walk away from the deal without too much downside if it doesn’t eventuate. This was Kerry Packer’s position when Alan Bond paid him a billion dollars for Channel 9 back in the late eighties. He was quite happy to keep on running the station and didn’t need the sale but at that price he also knew a good deal. The $750M deal he made on buying it back when Bond got into trouble was a happy epilogue to the story. Bond was in High Need and Low Power and suffered as a result. If you really ‘need’ the deal, then the ‘Silver Rule’ also means you must at least mitigate your weakness with a BATNA (Best Alternative To a Negotiated Agreement). Similarly to Kerry Packer there is an epilogue to my Egyptian purchase but unfortunately for me it doesn’t quite compare with his. When I got the bottles of perfume over to England, I opened my bag and found the contents of all three bottles had leaked all over my clothes. The smarting scent sellers had put the perfume in dodgy bottles and despite extra washing I walked around for weeks smelling of eau de “lookwhoislaughingnow” . That is probably more related to the ‘law of karma’ than the ‘Silver Rule’ but that is the subject of another blog… along with maybe the ‘Golden Rule’ of negotiations!

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About the Author:

Tim Higgs  

Tim has been involved in the corporate training industry for over 15 years; seven of these have been as the Portfolio Manager and Senior Facilitator at New Horizons. Tim holds a Graduate Diploma (Psych/Couns), a masters’ degree in Cultural Psychology and a bachelor’s degree in Business, giving him a unique theoretical backdrop for understanding human performance in the workplace. This complements his actual experience of working within the corporate sector in sales and management positions and owning and running a small business. Having worked with individuals and groups in both clinical and business settings, Tim has a fantastic insight into human behaviour, motivation and the issue of human change.

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