Negotiation and Customer

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Negotiating as a Used Car Salesman
Edward B., a used car salesman for a local Houston franchised auto dealership, granted an interview describing his experience with negotiating as a used car salesman, providing that his last name and place of employment not be disclosed. Edward’s official job title is pre-owned sales representative and he defined his job as selling used vehicles while achieving and maintaining appropriate levels of gross profit, volume, and customer satisfaction. As a veteran in the auto industry for twenty-three years, he holds a lot of negotiation experience. Edward feels that although official training is always provided, he has mostly learned from experience. (personal communication, October 26, 2011) Perspective Description of Negotiation Process

When asked to describe the negotiation process from his perspective, it was discovered that his description resembled Greenhalgh’s seven phases of negotiation. (Greenhalgh, 2001) Greenhalgh’s seven phases of negotiation include preparation, relationship building, information gathering, information using, bidding, closing the deal, and implementing the agreement. During the preparation phase, critical information is acquired and determined such as the negotiator’s bottom line, goals, and opening offers. (Craver, 2003) The negotiator must accept that knowledge is power during negotiations because those who thoroughly prepare for the negotiation generally achieve more beneficial results than those who do not. Preparation allows the negotiator to possess greater knowledge and confidence in their positions to value their impending interactions. (Craver, 2003) The outcome of increased confidence overshadows the less prepared opponent, resulting in those persons questioning their own positions. Taking the time to build relationships or develop rapport with the opposing negotiating party can contribute to establishing a mutually supportive environment, which reduces the unproductive anxiety created by adversarial conduct. This phase of negotiations is especially critical because the atmosphere created by the participants affects all phases of the negotiation process. (Curhan, Elfinbein, & Xu, 2006) It has been revealed in studies that negotiators who begin interactions in positive moods tend to negotiate more cooperatively and are more likely to use problem-solving efforts to maximize joint returns. (Craver, 2003) Further, studies have also shown that when negotiators commence encounters in negtive moods, tend to negotiate more adversarially which generates less efficient results. Additionally, participants with negative moods are more likely to utilize deceptive tactics than those with positive moods. Negotiating with information is mandatory for a successful negotiation. In order to negotiate intelligently, the negotiator must collect and process information to be informed of the situation and formulate a negotiation strategy, which is the information gathering stage. (Wang & Zionts, 2005) Research conducted on the automobile retail industry has shown that the customer negotiator who gets a minimum of two quotes of negotiated automobile offers pay an average of 0.6% less for their purchase. (Wang & Zionts, 2005) The amount saved is a measure of the value of what is achieved through the negotiation process. Asking broad, open-ended information seeking questions is the most optimal way to ellicit information from opponents and induces them to speak, as apposed to asking narrow questions that can be answered with brief responses. As negotiators communicate more, more information can be disclosed directly and indirectly. (Craver, 2003) The information using part of the process should begin after the negotiator has obtained a significant amount of information to begin narrowing their questions to confirm the information already obtained. If avoidance in response to the confirmation questions is observed, the negotiator should...
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