Know when to walk away from a deal with BANTA: Best Alternative to a Negotiated Agreement.
Negotiation is an art. However, you can turn your negotiation into a very logical process, dependent from your emotions and preferences. To achieve this, you first need to identify your Best Alternative to a Negotiated Agreement. In other words, what is the bottom line for you to walk away from a deal?
Why is that we make a deal that makes us worst off than a no deal situation? Why is that we walk away from a deal that makes us better off than a no deal situation? This may seem too stupid, but believe me, it happens all the time. Even to senior executives and experienced individuals. Why is that? Simple! Because they don't know what the BANTA is!
So how do you define what your BANTA is? Well, to define your BANTA you first need to know where you are, and where you want to go? In other words, what is your goal? The goal that you want to achieve through a negotiated deal can vary. Below are a few scenarios that many of us may encounter in our career and in our personal life.
Ask for a salary raise
To know your BANTA, you first need to know where you are at? Do you already have a job offer with a higher pay in hand? Do you have a job offer with similar or a slightly lower pay than your current one but has a better job description? Are you willing to walk away from your current job if your boss doesn't grant you your wish? Ask these critical questions first. Then you can decide if you want to aim high or aim low, be aggressive or be conservative
Selling your company to another enterprise at a decent price
Who else is going to acquire your company if this enterprise doesn't? How much are other potential buyers willing to pay? Why are you selling your company? What is the chances of your company surviving in the long term if you don't sell it to a bigger enterprise. How urgent are you in selling?
Trying to get a mortgage loan at the lowest rate
Do you have an alternative financial institution that is willing to provide you a mortgage loan? At what rate? How urgent are you in getting a mortgage loan? The amount of annuity that you are able to afford? Do you absolutely have to buy a house? Can you rent an apartment instead? Are you able to come back with more leverage a few months later?
Think through questions that are related to where you are and where you want to go. Know what your BANTA is before you sit down at the negotiation table. If what they offer is better than your BANTA, take it! If not, walk away.