Eye on Entrepreneur > Strategy #1: Be Willing to Walk Away

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I refer to my negotiation tactics as strategies - not rules – because I tend to break them from time to time.

The first and most important strategy that I’ll emphasize is that you must Be Willing to Walk Away. That’s right. You must walk into the negotiation with a mindset that the issue at hand might be something you want, but don’t necessarily need. And if the price isn’t right, you’ll get up from the table and leave the deal without any regrets. I, for one, know that at times walking away is much easier said than done. But it’s vital to your success that you create a total mind/body attitude that allows you to walk away if the situation calls for it. Now listen up: If in a particular case you find that you’re not willing to walk away – that you must make the deal – then at least don’t let the party on the opposite side of the table in on your secret! Fake it until you make it. Otherwise, you’ll be road-kill, and you’ll end up paying way more than you should have or accepting way less than you could have.

I remember one of my first lessons in negotiating came when I was a freshman in high school and my dad brought me to South Street in center city Philadelphia for the first time. It wasn’t the South Street you see today with the wild stores and nightclubs, the bustling cafes and cheesesteak shops, and the pretty girls on parade. Back then, South Street was down and out, with burned-out buildings abutting no-frills clothing stores and dicey eateries. And each store usually had a shady character on the sidewalk hawking its wares, trying to entice the passersby to come inside.

I remember the best of the bunch was Krass Brothers – the “Store of the Stars,” as they called themselves. They were known for their wacky television commercials and impossibly good deals. Not surprisingly, there was a large sign that hung above the door that read: “Shoplifters will be shot!” I looked over at my dad, and he nodded, “yeah,” and smiled. I loved it!

We continued down the street and ended up at Big Al’s. It was a beaten-down store with a big, bruising sales-thug outside as a welcoming committee. He escorted us inside as if he was our new best friend. The store was loaded with all kinds of men’s clothes. Racks of suits, shirts, and pants were everywhere and anywhere, and in no particular order. But my dad knew exactly what he wanted: a mid-length black leather jacket.

My dad informed the thug of his goal, and we were instantly led to the back of the store and up to the second floor. I thought the dilapidated stairs were going to collapse any second. Let me tell you, if I hadn’t been with my father, I would’ve been beating a path back to Krass Brothers. But no fear when my dad was here — he was one tough cookie. When we hit the second floor, the thug turned us over to a slick, fast-talking salesman who shook hands as if he was trying to cut off your circulation. This guy’s idea of making a first impression meant leaving dimples in your hands with his three large gold rings!

My dad tried on a black leather jacket in front of a dirty mirror. He asked the salesman, “How much?” The salesman said, “That jacket is pure leather, it looks great on you, and it’s only $100.” My dad asked, “How much for a special customer?” The salesman put his arm around my dad’s shoulder and replied, “For you, $90.” I smiled at the realization that the price wasn’t fixed. In a department store or a supermarket, the price was the price, even if it was something on sale. But here the price was…flexible.

My dad looked at me, winked, and said with a straight face, “I’ll give you $50 for it.” I was stunned, and kept a watchful eye as the thug’s expression changed. Uh-oh. But the slick salesman, not skipping a beat, said, “OK, because I like you, you can have it for $85.” My dad took off the leather jacket, turned, handed it to the thug, and said, “Let’s go, Pat.” As we approached the top of the stairs, the salesman said to the back of our heads, “My best price is $75.” My dad turned, looked him in the eyes, and said, “Because I like you, I’ll give you $60 for it. And that’s $60 more than you had a minute ago.”

I have pictures of my dad wearing that black leather jacket. He looked so cool. But in retrospect, what was really cool was the business lesson I learned and continue to use since that special day on South Street. Whether it’s a leather jacket, a new car, a real estate transaction, or a job interview, you must define your goal, do your homework, and take action. And then be willing to walk away if the situation isn’t right. In the process of negotiation, he who cares less, wins! -- PC