CLOSING THE DEAL

September 13, 2012

When negotiators approach actual agreements, they enter a delicate portion of their interaction – the Closing Stage. If they get this far, they almost always conclude their interaction successfully, but the way in which they close the remaining gap can significantly affect the final terms achieved. Bargaining sessions create anxiety due to the uncertainty involved. The parties don’t know whether agreements will be achieved, or what the actual terms will be. As they see tentative agreements on the horizon, they move swiftly to close the remaining gap and solidify the deal. They may still be $5000, $50,000, or even $5,000,000 apart. How they close that gap will greatly affect the final terms. Nothing requires them to split the remaining difference. The more patient and more manipulative side may be able to induce their less patient opponent to close 60, 70 or even 80 percent of the gap.

When negotiators reach this part of their interaction, they tend to speed up to conclude the deal. They should actually do the opposite. They should slow down and not rush the process. If the other side is more anxious, it will make more concessions and larger position changes during this stage of the process. They should praise the other side for its efforts in this regard, and let them move more expansively. While it is critical not to use disruptive tactics during this part of the interaction, to keep the process moving toward a successful conclusion, it is imperative for persons not to hurry. They should be certain they are not bidding against themselves with unreciprocated concessions, and they should encourage their opponents to close more of the remaining gap. They may be able to develop effective emotional appeals by pointing out how many position changes they have already made, hoping to use this approach to induce careless opponents to concede more than they receive. Even where parties have moved together during the prior portion of their exchange, if one is induced to close an excessive part of the remaining gap during this stage, the other side will achieve far more beneficial final terms.