EverydaySpy Podcast - The Secret Shortcut to Winning Negotiations

Episode Date: May 2, 2023

How much easier would your life be if you never lost a negotiation? Well, today is the first day of that new life! There is a simple and powerful secret that spies use to win every negotiation. And that CIA HACK has incredible value in the everyday world. In this episode, Andrew gives you a bulletproof plan to make more money, close more business, and unlock the career success you've always wanted. Learn more about your ad choices. Visit megaphone.fm/adchoices

My name is Andrew Bustamante, and this is everyday espionage. I recently had a proposal come in from a potential third-party provider who I was looking to hire, and the proposal came in at a ridiculously high rate. And what I mean by that is that it wasn't that the rate itself was outside of, you know, a reasonable rate. It was that I had no idea who the individual was, right? So I had essentially put out a call for proposals for a new project that I wanted to develop. And one of the proposals that came in from somebody that I was actually really excited to hear

from, when that proposal was submitted, the price was much higher. I mean like 150 to 200 percent higher than what I was actually expecting. Now, when that happened, I wasn't necessarily surprised, but I was disappointed because now all of a sudden this proposal that I was looking forward to, because I was looking forward to doing business with somebody that I like, all of a sudden I had to consider it on a competitive basis primarily, which is unfortunate, right? So what I wanted to do was I wanted to take some time with you today to walk through the mistake that my friend made when submitting this proposal and then tell you how you can make sure you never make the same mistake, how you can make sure that

every proposal you ever submit, every bid for work you ever offer, every negotiation, every negotiation, that you enter is a negotiation that puts you in a position where you're going to win. Because if you can win negotiations, if you can win proposals, if you can win offers, you will never have to worry about money ever. And that's the thing. That's the secret that so many people don't understand is that the trick to making money is less about having someone pay you what you think you're worth and more often about having people pay you less than they think you're worth. Now, let's walk through and unpack that. Okay, so mistake number one that we often make when it comes time to recommend ourselves

for work or submit a proposal or make an offer is that the first question we ask ourselves is, what do I have to make? How much do I need to earn from this proposal? The reason that that is a fundamental wrong perspective to start from is because you have to keep in mind that you are a service provider to another customer, whether that customer is your personal client, or whether that customer is a client of your company or a client of your business, or even that customer might be your boss or your supervisor. You have to remember that your point of view and what you think you need actually doesn't matter to your client or to your customer.

Now, that's important because your customer is not thinking about you. Your customer is thinking about themselves. So if you think about yourself first and your customer thinks about themselves first, there is no common ground between the two of you and your chances for miscommunication, your chances for missing the opportunity are much higher. When your customer is thinking about themselves and you are thinking about your customer, right away you have a common ground. And you're both thinking, at least in some relative portion of your consideration, you're thinking about the customer first, which means that right away you and the customer have something in common which increases the probability that you're going to create a proposal or an offer

or make a decision that the customer agrees with. No matter how you look at it, the chances of the customer ever thinking about you first before they think about themselves are almost nil. It's completely low probability to think that a customer is ever going to think about you before they think about themselves. When was the last time you went and bought a car and you thought about the salesman's needs before your own needs? When was the last time you ordered a coffee? And you thought about the barista's day before you thought about your own day.

When was the last time you ever got your paycheck in the mail and you wondered whether or not the HR person who ran payroll was having, you know, a good day, a bad day, or whether or not they're fighting with their spouse or arguing with their kids? No customer ever thinks about the service provider. The customer always thinks about the customer. So if you want to have a specific advantage over your customer or your client, the first thing you need to do when you create a proposal or when you enter a negotiation is always think about the customer's point of view first.

All right. Mistake number two that the proposal did for me. When the proposal came in from my friend, they not only were thinking about what they needed first, but then they were also thinking that they wanted to get paid a certain amount so that it would be worth their time. The challenge with this kind of mentality is that you are not a good judge of what you are actually worth. Now, here's what I mean by that.

There's a really good chance that you are actually worth a whole hell of a lot more than you think you're worth. That's not what you expected me to say, right? You probably expected me to say that you were worth less than you think you're worth. In fact, the opposite is true. If you work for a company, if you're an employee right now, You may not realize this, but your company has hired you because they believe that you will be able to create 300% more revenue for the company than what you cost the company. That's a foundational calculation that's used when a company decides whether or not to hire someone.

If you are in a sales role or an account management role or any kind of role that actually generates revenue, then they're actually expecting you to create more like 500 to 7. 700 times more than what you cost, which is why you're probably incentivized with either a commission or an annual bonus or some sort of sales bonus. So it's important for you to understand that no matter what price you think you're worth right now, you are actually most likely worth more than that. So again, if we go back to our first point where you have to think about the customer before you think about yourself, you can assume that the customer does not look at you with an eye towards accurately assessing what you're really worth. All right? The customer is looking at you and thinking about the customer. And then the customer is also looking at you and assuming that you are worth less than what you are really worth.

So you can see how quickly the divide increases between the business owner or the salesperson and the actual customer themselves. And this is why so many negotiations go awry. This is why there's always hurt feelings. there's always angry people, there's always arguments and debates because people just don't fundamentally understand the value of each other. The business owner very rarely appreciates and understands the true value of their customer. Let's be honest, that's true. And the customer for sure doesn't understand or value the business owner or the salesperson themselves. And if you're

in sales, I know you know what I'm talking about. You work hard and nobody appreciates or understands how hard you work. So we understand these things to be true. So how do we fix them? How do we fix the fact that you are undervalued by both yourself and your customer? And how do we close the gap between a selfish customer and potentially you who are thinking about what you need first? Now, the trick here, the hack that we learn at CIA is that you can always assume that

other people will think about themselves first. You can always assume that. So if you assume that, you are already 99.9% accurate. It's very rare that somebody else thinks about you before they think about themselves. The second piece of this is that you always want to be ready to offer something that the other person will want for themselves. Because you already know they're thinking about themselves, right? So the two hacks again, the two hacks are you can always assume someone else is thinking about themselves, before they think about you. And the second hack is that you want to offer them something that benefits

themselves because that's who they're thinking about. When you do those two things together, what happens is you are actually hijacking the decision-making process of the other person. So let's use this an example with a car sale, right? If a car salesman is thinking about the customer who walks in the front door first, then that car salesman is telling themselves, this person is looking for a new car. Well, this person is looking for a car for sure because they walked into a car dealership. This person might be looking for a new car or they might be looking for a used car. I won't know until I start to talk to them. But right away, you can assume the person's looking for a car. Now, when that person comes up and starts talking to that car salesman, the car salesman

should also be assuming that the person doesn't actually want to talk to a salesperson. The person was really hoping to come in and kind of browse and look around and be left alone, because that's what we all secretly want whenever we start considering buying something. We very rarely want a salesperson to come out of nowhere and offer help right away. We want five, ten, fifteen minutes to kind of explore the showroom floor and get a sense of what we want before we talk to a salesperson. So when a car salesperson thinks about what the customer wants first, they're going to let the customer come in, they're going to let the customer browse the showroom floor, And then after five, 10, 10 or 15 minutes, the car salesman is going to walk up and introduce themselves. They're not going to say something like, you're looking for a new car.

I know exactly what you need. Hey, you look like a family that's looking for a new set of wheels. That's all stuff that's going to turn the customer off. Instead, if a car salesman walks up, just introduces themselves and says, hey, my name's Andy. Hey, my name's Brian. Can I help you today? That's all you need to say. Because what's the customer thinking in the back of their head?

they're thinking, I need a new car and I need help choosing which car and making the purchase. So right away, when you think about the customer, you're going to be one step ahead of the customer, which is going to allow you to guide them in the direction you need them to go. That is what my friend did not think of when they submitted a proposal to me. They did not think of me as a customer. They did not think of what I needed. they did not think of what I wanted. So the first hack was a solid miss for them.

Now, the second hack, if you recall, the second hack I taught you, was that you need to offer something that the customer wants, right? Offer something that benefits the customer before it benefits you, offer them something that they want, because obviously the customer is thinking about the customer first. So if we use our car salesman example, the car salesman probably wants to offer the person who's looking at the car, a chance to see inside the car.

They want to offer them a chance to walk around and see all the cars on the lot. You know, can I get you a cup of coffee and have a snack? Do you want me to turn on a show so the kids can watch TV while you and your wife look at cars? There's a thousand things that a customer wants before they want to give you their money. There's always a thousand things that the customer wants, right? And a good car salesman knows that. So whenever a really effective car salesman is doing their job, They're not trying to push somebody into a new car.

They're not trying to push somebody into the most expensive car. They're not trying to sell somebody on the bells and whistles of a financing plan. You've probably been in a position where a bad salesman tried to pressure you into any or all of those things. Instead, a car salesman who's coming to you talking about what you actually want, right? Let me get you a cold drink. Let me get you a hot cup of coffee. Let me help take the stress of having a couple of kids off your shoulders by letting them watch a TV show or play. play a video game. Can I show you the inside of these cars that are inside the showroom? Because

nobody wants to go outside and freeze their tail off or sweat their tail off. So why don't we show you what's inside the showroom floor where it's nice and comfortable first? These are all the things that a customer wants because it makes them feel good and it helps them and it makes it easier for them to move forward in the sales process. When my friend came to me and told me that they needed a high price to do this project, I didn't feel like they were thinking about me. I felt like they were thinking about themselves. If instead they were to come to me and say, hey, you know, Andy, with this proposal, I can tell that you're thinking about some big changes for everyday spy.

Hey, Andy, I really like where you're going with this idea that you're asking for proposals about. Hey, Andy, I'm curious whether or not you need other help in these different areas that are kind of related to this proposal because what you're working on is pretty complicated or pretty advanced, right? My friend, this person who submitted a proposal, was not thinking about me. And I could tell they were not thinking about me. So they missed both hacks. Not only did they not put me first, but they also did not offer me anything that I wanted or needed right away.

So they did not make me think of them as a thoughtful partner. they did not make me think of them as a value added team member. Now, what happened at this point, right? Now, at this point, we entered into a negotiation. And because I'm me, I'm very direct with the people that I negotiate with. So I told this person straight up. I was like, look, your proposal that you're coming from is in an unrealistic price point, right? I like you.

I like your work, but there's no way I'm going to pay you this level of price for the of work that I'm looking to do right now at this level of reprosal, right? I was looking for a budget of X to Y, right? I gave them the budget I was looking at. I gave them the time frame. I gave them some of the challenges. I essentially laid out the expectation that I had that they could have anticipated had they been following the two hacks that CIA gave me that I just taught you, right? Had they been thinking about what benefits me and had they been thinking about me first, they would have been able to anticipate everything I shared. But that's not what they did. So they were one step behind me. When you're one step behind the person you're negotiating with, that's all it takes to lose the

negotiation. So by the end of our conversation, we had agreed. We had closed the deal. And I am going to move forward with the proposal that my friend submitted. But I had talked them down almost 60% from their original price, and I had added a great deal of stipulations about how they're going to move forward with that project. So from that point of view, you can see that they lost the negotiation. They were hoping to make more money and have more control. Instead, they're making less money and they have less control. The reason that they lost that negotiation is because they did not follow the two simple

hacks that I am sharing with you today. When you think about your customer or your client first, it puts you in an advantage, an advantageous position, because you can stay one step ahead of what they're thinking. Now, when you're one step ahead of what they're thinking, the next thing you want to do is offer them something that benefits them up front, especially something that benefits them that doesn't really benefit you. Now, the simplest, easiest tactic to use anytime you enter negotiation is to always propose your price as a price that is less than what you think you're worth, less than what you're actually worth, and less than what the customer thinks that you're worth. And here's why.

Because that is going to make the negotiation go in your favor very quickly. Because the customer is going to feel like they're getting a deal right away. The customer is going to think to themselves that you are giving them a discount or that you are committing to a long-term relationship or that you are taking a chance because you believe in the project. The reason they're making those assumptions is because you're coming in at an offer price that's even less than what they were expecting to pay. Now, here's the other part of negotiation. following an initial negotiation and you go through the initial delivery of the service, guess what always follows? A renegotiation.

Now, it's during the renegotiation that you actually change the stipulation. You change the price, you change the agreement, you change the expectations as you continue to move forward with your client. All right. If you're thinking that this is unfair or if you're thinking that this is unprofessionally, or if you're thinking that this is inaccurate, you are dead wrong. You need to hear me now and consider that there is one strategy for winning negotiations, whether you're a business owner, whether you're a corporate executive, even if you're out there in a bidding war for open proposals. There is

always, always the opportunity for renegotiation. No negotiation is ever closed. Even if you're renegotiating in the middle of a contract, there is always, always room for renegotiation because a renegotiation is an opportunity for both parties to win again. That's why nobody says no to a renegotiation. They may not accept your terms of a renegotiation, but very few people will ever just flat out say no to a renegotiation. So your strategy is to offer your service, offer your talent, offer your project, offer your product at less than what you know your worth and less than what the customer thinks you're worth.

Then when you are in the process of delivering that service, you always want to over deliver. Deliver more faster and at a higher quality than what the customer originally expected. Now you're using both hacks that CIA uses. You're putting the customer first and you're giving them a benefit they didn't expect. After you've done both of those things and you come back to the table and you ask for a renegotiation, not only is your customer going to say yes, but they're going to be way more open to paying you a significantly higher amount. Because now you have set a new baseline expectation for them and they understand that you are worth a lot more than what you're asking for. So when you ask for 20% more, 200% more, 400% more, they recognize,

that they're going to pay you more and you're going to over deliver yet again. This is the human psyche. If my peer, if my friend would have recognized that, the whole negotiation would have looked different. They would have come in offering a very low price. I would have been ecstatic at the low price. I would have said yes to their contract and the proposal and they would have walked away being in total control of their own project.

And then, six months from now, they would have come to me asking to renegotiate. I would have seen their spectacular work, and I would be more than happy to pay them more money. You see how that could have worked? Instead, the way it's working now is I essentially bullied them into a lower price. They are now on the hook to operate under close scrutiny. And then if they come back to the drawing table in six months to renegotiate, I will be open to renegotiating, but I'm going to renegotiate from a point where I have to control their price and I have to control their activity because that's the precedent they have set. You never want to set that precedent. You never want to be the person that your client doubts or distrusts. Instead, be the person that

comes in and offers an incredible offer, an incredible opportunity. Be forward leaning by offering your client something that benefits them, by putting them first, being one step ahead of them, because when they see that in you, they're going to believe that you understand their needs. They're going to want to do business with you and they're going to trust you. And when you come back to them six months later, six weeks later, six years later, and you ask to renegotiate the terms of the contract, you will be able to earn more money and you will have more control than you ever thought before. And that is everyday espionage.

Everyday espionage is dedicated to one thing, educating everyday people. I know that not everyone will listen, but those who listen will learn. If you learned something new today, click subscribe, review, and share the podcast with a friend. Find me on social media at EverydaySpy or on my website, Everydayspy.com. If you are up for a special challenge, visit Everydayspy.com forward slash operations. And join me for an authentic spy. training mission. And above all else, remember that knowledge is freedom.