Don’t worry; you do not have to know how to play poker to understand the simple and effective negotiating concepts below. The timeless card game of poker has many similarities to negotiating and here are three ideas you may want to keep in mind.
#1: The Ante
In poker, the “ante” is the initial bet. You are not officially in the game until you have placed some type of minimum wager. In other words, you must have something at risk in order to play. Where the ante relates to successful negotiating is that you must make sure that whom you are negotiating with, has made a commitment or can do so. You want to negotiate only when there is money on the table.
For instance, you never want to negotiate with someone who has not committed to doing business should you come to agreeable terms. Often people, in particularly sales people, end up negotiating “in theory,” dealing with someone who cannot or will not make a decision.
In such a case, the opposition is able to get you to expose your maximum or minimum offer without risk. Or in poker-speak; to get you to “show your hand” without placing a bet. This is a tactic used when the party wants to “play you off” of your competitors or has no genuine interest in the first place.
#2: The Bluff
Everybody has an understanding of what it means to bluff, and in negotiating, bluffing can be a useful tool. I am not talking about making false claims or promising things that you cannot deliver. I am referring to bluffing about your negotiating limits. One such time to bluff is when you are at or near your negotiating limit. You do not want the other party to know that you are close to the end.
You see a lot of this in live auctions: One party aggressively bids, giving the impression that he or she is willing to go all the way, regardless of the price, to obtain the item. This often leads competitors to offer their highest bid prematurely or to back out; which in poker-speak, means to “Fold.”
#3: The Ace In The Hole
In many versions of poker such as 5-Card Stud, each player can see the other players’ cards, except for one. The card that remains turned facedown is referred to as the “Hole Card,” which can often completely change the “value” of the player’s hand once exposed. You have heard people say, “In negotiating, don’t put all of your cards on the table at once…” Well, this is where the saying comes from.
Keep an Ace, meaning something that you can add to the offer that will significantly alter the value of the deal. Even while rigorously negotiating price, try to hold on to your hole card as long as possible.
I am certainly not a professional poker player. However, I know that in negotiating, as the Grammy Award winning, country music star Kenny Rodgers said in his 1978 hit, “The Gambler…”
You got to know when to hold ‘em, know when to fold ‘em, know when to walk away and know when to run!
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Sean McPheat is a bestselling author and MD of international training firm MTD Sales Training. Sean is also a much sought after International Speaker, and is well known in the sales and marketing industry for his insights into the future of modern day selling, his countless sales experiences and his insights into the world of the modern day buyer. Follow Sean online here.