What Every Boat Broker Should Know About Negotiation (Part 1)

July 30, 2018

He Suddenly Interrupted Me And Asked:

“And how much does it cost for the package?”

I was so nervous. It was the first time I was charging a client for a project at this price. I swallowed my saliva, took a deep brief breath and said with a not so confident voice: “Euuh, Two thousand dollars”.

He immediately responded: “Ok, well I am not going to pay you two thousand” and proceeded to a moment of silence. During this short time (which felt like an eternity), my face started completely decomposing to the idea of starting a negotiation with this experienced business owner.

He added: “I will pay you $3000.”

If you want to know the best secrets of negotiating and...

… you want to know why this client decided to pay me one thousand dollars more on my first big marketing gig, then keep reading. 

If you want to keep losing money on the table every day of your life then just go back to work or browsing Facebook and disregard this blog post. 

“You will never make as much money as you do when you are negotiating.”

Why don’t they teach us negotiation at school?

Just like selling, negotiation is something we use every single day of our lives. Negotiating is an art, and with a lot of preparation and practice, it can become an extremely valuable skill in life.

Being a great negotiator offers amazing advantages in both your personal and professional life. However, the general public perceives negotiation as something reserved for certain limited circumstances in life like lawyers, the corporate world, politics, sales, etc. 

But in reality, this is something we use every single day in so many areas of our lives such as business, relationships, parenting, family, friends, and during almost every conversation we have both personally and professionally. 

Mastering negotiation is not only A skill that pays the most amount of money in the minimum amount of time, But, it's Also...

… about being able to live the life you want.

I’ve read dozens of books, articles and have taken a number of courses on the subject to curate and gather the best tips and techniques that you could apply to your daily boat sales activity. 

So without further ado, let’s dive in!

Firstly, I would like to share my 2 personal best tips on negotiation:

#1 The best way to negotiate is to set yourself up in a situation where you don’t have to negotiate at all. 

Let me explain.

It was about 10 years ago. I was a boat broker but had started a small digital company on the side with my friend and business partner Michael Hrustaliov. We wanted to sell brochures, websites, and virtual tours to people in the boating industry. 

One day, a client who had listed a brokerage boat with me asked if we could do a project for him. (Website+ virtual tour of his boat for a new charter company he was starting). 

It was our first large project. The client was just starting a local boat charter company and asked what we could do for him. We were so thrilled and enthusiastic to serve him so we started enumerating all we wanted to do for him. 

The time finally came to sit down and talk about numbers, so he asked me, “How much will it be?” I hesitated and said: “Well John, for a project like this, with everything included, it would be $2000.”

He immediately responded: “Well, I am not going to pay you $2000!” and then proceeded to a few seconds of interminable silence.  

He then added: “I will pay you $3000.”

What in the world!  My first big project just got transformed from a 2k project to a 3k. 

John was so impressed by our enthusiasm and the amount of work that we wanted to do for him that he decided to pay us 33% more. 

You see, the most important element in any negotiation is the people negotiating. Win their heart and it will make your negotiation a breeze by either not wanting to negotiate at all or even better, giving you more than what you want. 

Let me now share my second best tip:

#2 Sometimes you are just better off avoiding negotiation and actually offering a bit more to your negotiating party to receive the absolute best value.

Here is an example: 

A couple of years ago, I hired a copywriter for my business. I was on the phone with him and after asking lots of questions about his service and what he could do for us, I finally asked how much he would charge. He said $750. I said, “Well, I am not going to pay you $750. I will give you $825.00. I want to pay you 10% more.” It only cost me 10% more but the guy worked so hard, I am convinced that he put 50% more effort and attention to detail into his work! 

I have done this a few times since then and I am always thrilled by the results it brings.

Would you rather save 10% and be treated like a regular customer or invest an extra 10% and be treated like a king? 

So now that I have shared my best 2 tips with you, here are the 5 fundamentals of becoming a great negotiator:

fundamental #1: Preparation

“You must always be ready to negotiate, but never negotiate without being ready.” Nixon

The easiest money during negotiation can be made by being prepared. The goal of the preparation is to establish your plan of action based on knowing exactly what you want to achieve during your negotiation but also be ready to face all the different outcomes of the other party. Because if you don’t know exactly what you want, you will be forced to compromise which will lead to you not getting what you want.

Gather as much information as possible. The more information you have about the people with whom you are negotiating, the stronger you will be.

Who will you be negotiating with? Do some research on them (I like to use Charlieapp, Rapportive or social media.)

Come up with an ideal outcome AND a minimum outcome. Always be willing and ready to walk away if you don’t achieve your minimum outcome.

fundamental #2: Mindset

It’s important that you try to maintain a confident and enthusiastic mindset about the upcoming negotiation:

✔️ Believe in your own worth and the position you’re negotiating

✔️ Practice being confident at all times

✔️ Avoid being intimidated

✔️ Stand your ground, especially when working with someone who is manipulative

✔️ Set a time and place to meet that is favorable to you so you are more in control of the situation

✔️ Practice professionalism at all times – don’t let your emotions get in the way and stay calm

Desperation is easily identified – it’s not something you can hide because of the tension and physical symptoms but also strong unconscious signals.

Some people might tell you to visualize and practice affirmative self-talking (affirmations).  We all know the importance of having the right attitude and practicing positive thinking. Motivational gurus have for years encouraged us to visualize achieving our goals. However, thinking positively can backfire on you.

Recent research by Doctor Gabriele Oettingen, a psychologist at NYC University, said that ‘the better you are at visualizing your goals the less likely you are to achieve them.’ Visualization can cause your brain to relax. It thinks the hard work has already been done. As a result, you lose focus and clarity making it much harder to reach your goals. Instead, Oettingen found that mental contrasting works better than positive thinking alone.

So here is the trick- visualize 2 things at once:

1. How great it would be to close that big sale (goals)

2. All the obstacles that stand in the way of achieving those goals 

The incredible power of negative thinking is needed to actually prevent epic failure while channeling your good feelings is needed to maximize success.

fundamental #3: Practice

We all know the old saying: “The more you sweat in practice, the less you bleed in battle.’”

Negotiation will occur daily and should, as a result, be practiced daily. Practice as much as you can- In front of the mirror, with your spouse, kids, coworker, even in your mind while buying a coffee. Next time you go buy coffee, try this line: “Can I have 10% off my regular order?” You will be surprised by how much money you can save every year if you constantly use this line. 

fundamental #4: Listen to The Other Side

Good negotiators are good listeners and good communicators, not just good talkers. By listening, observing behavior and body language, you can learn things that will help you so much in negotiation. You’ll learn more by asking good, open-minded questions than you will by cross-examining the other side.  Remember that if you want to be heard, you will have to listen and never assume that the other party is finished with what they are saying.

You can become an effective listener by allowing the other person to do most of the talking. Follow the 70/30 Rule – listen 70 percent of the time, and talk only 30 percent of the time. Encourage the other party to talk by asking lots of open-ended questions – questions that can’t be answered with a simple “yes” or “no.”

Shut up and listen. This is probably one of the most known sales techniques for one simple reason: it works. You will be surprised at the amount of money that you will make by actually not saying a word and being silent!

fundamental #5: Empathy

Empathy is seeing through the eyes of another, listening with the ears of another, and feeling with the heart of another. 

By showing some empathy, there’s a better chance of working towards a better outcome for you. Think of the negotiation as a problem that both sides are working to solve together.

Don’t take the issues or the other person’s behavior personally.  All too often negotiations fail because one or both of the parties get sidetracked by personal issues unrelated to the deal at hand. Successful negotiators focus on solving the problem, which is: ‘How can we conclude an agreement that works for both parties?’

Want More Powerful Negotiation Tips Like These?

If so, then read Part 2 of this series:

The Boat Broker Negotiation Checklist

Just head on over here: 

https://www.yachtsalesacademy.com/blog/boat-broker-negotiation-checklist-part-2/

To your success!

— Vincent Finetti
Founder & Instructor
Yacht Sales Academy

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