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Updated: 12 Nov 2019

Negotiation Bargaining

[ni-goh-shee-ey-shuh n] [bahr-guh-ning]

Bargaining is a simple form of the distributive negotiation process that is both competitive and positional. Bargaining doesn’t seek to create value, but instead focuses on negotiators claiming value.
Bargaining very often revolves around a single issue—usually price.

Bargaining predominates in one-time negotiations, e.g. buying or selling a car or house when you don’t intend on having an ongoing relationship. One side usually attempts to gain an advantage over another to obtain the best possible agreement.

Most negotiation training seminars will start by teaching the essentials of bargaining, which includes at a minimum:

  • Understanding that your and the other negotiator’s opening offers are the most powerful predictors of where you’ll finish up. So be ambitious enough and be prepared to justify your opening offer.
  • Negotiation Anchoring: whichever negotiator is more successful in anchoring their opening offer will enjoy more of the bargained value.
  • Changing your opening offer when negotiating in different countries whose cultural practices differ from your own. For example, Chinese negotiating with Americans do well to moderate their ambitious starting positions to avoid deadlock.
  • Defining your Walk-Away level and not going beyond.
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    S S V Raghavan on

    Short and sweet.

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