How a BATNA Can Change the Way You Negotiate

February 09, 2022

Desperation can easily hamper a skilled negotiator. When you believe that making one specific sale is the only option, it severely limits what you feel you can ask for and argue against. Ultimately, this can lead to lopsided deals and unfair agreements. 

Luckily, it's rare that the vendor you're meeting with is your only viable option. They may be your top choice, but there are often other suppliers that can meet your needs. Discovering who these suppliers are and finding a way to work with them instead in case negotiations with your first choice fail is an essential part of any contract negotiation. 

Find Your BATNA

Never walk into a negotiation telling yourself that this supplier is your only choice. Before the meeting, work out your best alternative to a negotiated agreement. A BATNA may involve going with a different vendor, managing production yourself, or partnering with another business. It's important that you research your BATNA as thoroughly as your first choice to ensure both options are feasible and beneficial. Once you have that viable second option, however, use it as your guide and reference point throughout the negotiation. 

BATNAs provide you with significant power in the negotiation. They allow you to request that your counterparty offer you at least as much value as the alternative is likely to reasonably provide. You don't necessarily have to tell your counterparty your BATNA. In some cases, that can actually derail negotiations. You can tell your counterparty what your alternatives are if you feel negotiations are stalling and you believe knowing may motivate them to make better offers. 

Follow Through

Even the best negotiators sometimes have to walk away from a deal. The things you want may not be possible with this vendor. You may discover things during the negotiation that make partnering with this company less attractive. Decide for yourself the minimum standard in price, values, or collaboration you expect from your counterparty. If they're unable to meet this standard, don't be afraid to leave the deal on the table and find another vendor.

If you find a vendor you do wish to partner with, remember that they're likely to have a BATNA of their own. Your professionalism and presentation matters at every stage of the agreement. Make sure your contract looks great and reads well. Don’t forget to reduce PDF file size to improve readability and help you double-check spelling, accuracy, and formatting. The deal isn't official until the contract is signed, and a shoddy or incomplete document sends the wrong message to your counterparty.

Always Consider Plan B

Even in high-pressure negotiations, additional options are almost always available. Make sure you weigh yours carefully before entering into any contract negotiation. Second options offer you confidence and power in a negotiation. You may even discover that your best alternative to a negotiated agreement was actually the best overall choice all along. 

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