#824 Pride goes before the Fall
In the early 2000's we decided to put an extension on our home. My company was growing by leaps and bounds, and my sales teams were absolutely on fire. We were crushing the numbers, and the sales managers and I all felt like we could negotiate a nuclear arms deal with Iran while drinking a latte and getting a manicure. We were a very confident group in a very sales-centric company. I tell you all of this because what I did in this construction negotiation has a lot to do with where I was coming from at that time.
I deliberately decided to interview contractors in the dead of winter. My thought was that winter is a time when contractors have no money coming in so I would use that to my advantage and get a better price. I could see each one of them willing to drop a little further than they hoped to because I was ready to write a big deposit check and they would have income during a time when they usually had none.
I knew I was a sound negotiator and planned to bring all of my skills to bear because this was a big deal for me. I had interviewed a couple of contractors and had a good sense of the cost. The final guy, Alan, was the contractor I thought I'd end up with because he was recommended to me by my good friend Rick. Alan had done an addition for Rick and done it well. Rick is an excellent negotiator himself and a very detail oriented guy, so I felt like if Alan got thumbs up from Rick, he must be good, and his price is probably reasonable.
Alan came in with a smile and bid for the job. Then, I kicked his ass. The combination of his winter need and my win at all costs mindset got him to take almost 30% less than his asking price. I was very pleased with myself. I bragged about it to my wife; my kids, and anyone else who would listen.
When I got to work and had my managers in for a meeting, I opened the meeting with an account of how masterfully I had negotiated this deal saving myself tens of thousands of dollars. There were high fives and back slaps and all of the hard-edged humor that our sales culture had spawned to crow about victories like this.
The entire project was to take three to four months. It went on for well over a year. What happened was that Mr. Negotiator, me, had driven the price so low that the contractor wound up doing a lot of the work himself. He couldn't afford skilled labor! There was no money to pay people. There were arguments and threats as I tried to get him to show up and finish the job but it dragged on. It was agonizing for Deb and me as we looked around at our incomplete home but couldn't really do anything about it.
Win-Win is what was needed in this negotiation, but I had been schooled in I WIN.
This was a harsh and costly lesson for me to learn. Next week I will tell you about the outcome.
Own your sales gene…