Your Opening Offer
Welcome to Lesson 3, where we are going to have a closer look at that all-important opening offer.
We’ve already seen in Lesson 1 that it needs to be beyond your best hope and in Lesson 2, that you would ideally delay putting it on the table until after the other person has revealed theirs, but there are three more things you need to know.
First, your opening offer should not be a round number. If you are buying and you offer someone $300,000 for their house or if you are selling and you ask $4,000 for your car, it’s obviously a made-up number: You’re just playing a game and it’s asking to be challenged. But if you offer $294,000 for the house, it looks as if you have VERY accurately valued it—either that or you have scraped together every last coin from your savings and that really is all you can afford. So, whether you are buying or selling, your opening offer and every number you quote from then on should be an “odd” one.
How odd? You can’t credibly offer someone $307,241 for their house, so I think it should be, say, $307,500. Odd, but not too odd. Generally, I think 4s and 7s are good, so $314 or $327. Certainly, 9s are suspicious and 1s aren’t worth bothering with!
Justifying Your Opening Offer
The second thing is to have a plan for how you will justify your price. Whether you are buying and offering a very low opening price or selling and asking for a high opening price, you need a credible explanation to justify that figure. It could be your costs or whatever is going on in the market—high demand, exchange rates, whatever. You could also say that the item you are buying isn’t quite right for what you want, but if it was much cheaper, you’d buy it, or that you are reluctant to sell the item you are selling, but if the price was high enough, you’d be prepared to part with it. But whatever your story is, you need it ready for when you open.
The third tactic associated with opening offers is, “The Flinch.”
This is the shocked reaction that you might give to their opening offer and the reaction that they might give to your opening offer.
The flinch usually consists of a combination of a sharp intake of breath, looking unhappy, putting your pen down, turning away, shaking your head, folding your arms, pushing your chair back from the table, pushing your fingers through your hair, crossing your legs away from the other person, or even walking a few paces away from them.
Always look to see if they flinch when you open—don’t make your opening offer while looking down at the floor. If they don’t physically react, then it means that they are happy with your offer. Even if they verbally say, “Oh dear, that’s a bit more expensive than I expected,” it’s the physical reaction you are looking for. And no, “flinch,” doesn’t mean that you need to move from there; in fact, you shouldn’t. It means you didn’t ask for enough, so they are already happy. So, surprisingly perhaps, you WANT them to flinch. Don’t feel bad if they do, because it means you’ve got your opening offer about right.
And YOU must always do a flinch when the other person opens, even if you’re selling and you’re secretly delighted how much money they have offered you, or you are buying and you’re amazed how low their price is. If you don’t flinch, they’ll think you’re happy, and it’ll be much harder to move them further. Have your flinch ready even before they make their opening offer.
That’s Lesson 3: Open with a non-round number, be able to justify it, look for the flinch, and do your own flinch.
I’ll see you tomorrow with Lesson 4, when we’ll be looking at how to reach maximum cooperation so you can get the best possible deal.
Bye for now!
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