Roger Fisher and William Ury in their 1981 bestseller book, Getting to Yes, proposed the term BATNA. BATNA stands for the “Best Alternative to a Negotiated Agreement”. In other words, it is your plan “B‿ when it comes to your strategy for the best option you have during negotiations. It basically comes down to comparing two or more options that you have and choosing the best one, where the most is gained.
Why is it important to have BATNA while negotiating as a Real estate agent?
One of the most important characteristics of successful real estate agents is their ability to negotiate successfully. BATNA is a measure of balance in these negotiations. As a real estate agent, having a good BATNA empowers you while negotiating on behalf of your client. If you know you can switch the flow of negotiations to a less desired but yet a better alternative, you can close the deal in a win-win scenario. BATNA gives you more confidence during negotiations because not only do you have more options but you also have a better option than the one you are being presented. If you don’t have BATNA, your plays during negotiation are severely limited which allows the opponent to raise their demands, and you’ll probably opt to accept them or break off negotiations because you may feel that you don’t have any alternatives to suggest. It’s important to note that many real estate agents have been putting into use the concept of BATNA without using such a formal structure. To most it makes sense. Why would you choose to stick with just one option which might result in failed negotiations, if you still have a favorable plan B which can result in win-win scenario for both parties? Some call it BATNA, some call it experience, and some call it common sense. BATNA is the formal strategy and concept highly used during negotiations, and are not always as obvious. There is an easy process to determining your BATNA in 5 simple steps.
Define Your Negotiation Goals
Understanding exactly what you and your clients want to achieve in the negotiation stage is critical. While you are negotiating to sell your potential client’s house, intent of “cashing out” will be very different from intent of “maximizing long-term value”. Sit with your client and discuss their expectations and intents. Mark what your objective is and where exactly a line needs to be drawn before breaking off negotiations. Be clear here, draw the line in the sand, physically if you think it will help.
Analyse Your Options
In this stage, you will brainstorm acceptable alternatives and list them. Next you will analyze those alternatives and their feasibility. If you cannot come up with any alternative, then probably you have no BATNA. The more alternatives you can think of and the more feasible they are, then you are backed up with a strong BATNA.
Pick Your BATNA
After thoroughly analyzing the list of alternatives available to you and your client, you will pick the ones which are most feasible. The number of viable alternatives available to you define how strong your position will be during negotiations.
Get Your Client’s Consent
It is very important that your client, whether you are representing a buyer, seller or investor, is in complete agreement with you in terms of BATNAs. Your client needs to be briefed on the the BATNAs you have defined early on. If your client agrees to back you up during the negotiation then all is good. There should be no perplexity about this.
Figure out your counterpart's BATNA
Now that you have defined your BATNA, try to figure out what the opponent’s BATNA might be, especially for high value deals. Of course you will not be able to receive it entirely, but if you can come up with few theories, it might help you enormously in negotiations.
As a Certified Real Estate Negotiator , you will understand what motivates your opponent in negotiations and have a solid BATNA to ensure that you can achieve a win-win outcome from negotiations. You will be able to better negotiate your commission with clients, provide strong representation for them during negotiations and successfully close more transactions.