Turn Approval Sales into Money in the Bank

09 Monday Jan 2012

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Sometimes people want to try before they buy.  They may want to see how your artwork fits into their environment or their collection before they commit to owning it.  If you put artworks out on approval or consignment during 2011, end-of-year is the perfect time to settle those arrangements. 

If the pieces have been out on approval past the originally agreed upon period, or if the period of time for the loan was not expressly stated or committed to writing, you might consider a tactic called the presumptive close.

In the presumptive close, you will use language that implies that the transaction is, so to speak, a done deal.  Here’s an example:

Let’s say you put a piece out on approval three months ago.  When you contacted the interested party thirty days later, s/he indicated that s/he wanted to return the piece.  However, s/he didn’t return it. Perhaps you left the piece there a little longer in the hope that s/he would change their mind.  (Btw, hope is faith’s sister.)

Instead of contacting the other party again to plead for resolution of the situation, try the presumptive close, i.e., send the other party an email stating, “Happy New Year! I hope you play your best golf yet this year. In closing my books for 2011, I noticed that I forgot to invoice you for xxx piece.  I’m pleased to have my artwork in your collection.”  If you’ve received any press, awards, etc., this is a good time to promote your work, so the other party will feel good about the purchase.  Then, continue with, “Attached please find my invoice.”

By using the presumptive close, you should get action: either the other party will pay for the artwork or s/he will return it.   Either way, it’s better than having to leave countless voicemail messages begging for resolution.  In the worst case, you will get your artwork back.  That artwork is an asset that can be re-deployed in 2012.

If properly used, the presumptive close has the potential to turn stagnant transactions into sales, while preserving the relationship with the other party.

Register for my Next Workshop

02 Monday Jan 2012

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Jump start 2012 by giving yourself the advantage of learning to make better deals.  Register for my next workshop.  Earlybird discount applies through February 1, and participation is limited to 24, so secure your seat now. 

Thursday, March 15, 2012 – 8:30 a.m. to 12:00 p.m.

Long Beach, CA (exact location t/b/d)

REGISTER

Negotiation Fox on GYS*T Radio

31 Saturday Dec 2011

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Jump start 2012 by learning how to get more through effective negotiation!

On Monday, January 2, 2012 at 2:00 p.m. PST, I will be a guest on GYST Radio. If you’re not available for the live broadcast, the segment can be accessed anytime afterwards on their blog, through the same link.

http://www.blogtalkradio.com/gystradio/2012/01/02/interview-with-nancy-fox-negotiation-fox

GYST Radio is a resource for all information on the business of art, hybrid careers and other DIY strategies for a successful career in the arts.

HAPPY NEW YEAR to all!

Better Decisions Through Distraction

27 Thursday Oct 2011

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We sometimes feel pressured during a negotiation to make a decision.  Perhaps that pressure comes from the other side, or perhaps it is pressure that we put on ourselves, because we perceive indecision as a sign of weakness.  Regardless of the source, it’s important to allow ourselves time to make complex decisions.

Research conducted by Maarten Bos, et al, shows that distraction, whether for a few minutes, overnight or a few days, can facilitate the processing of information, help us prioritize, and result in better decisions.  By taking a break from the problem, we allow our unconscious to do some of the work while our conscious self rests.  If you need time during a negotiation to reflect on a critical decision, take a break or schedule a second meeting on another day.  While away from the issue, do something you like to do, work on something else and get some rest.  The need to reach a decision won’t go away, but chances are you’ll have a clearer picture of the alternatives afterwards.  When faced with a complex decision, give yourself permission to sleep on it.

To read more about this subject, I recommend this article from the Harvard Business Review:  http://blogs.hbr.org/cs/2011/05/a_counter-intuitive_approach_t.html

Getting More from Reciprocity

22 Saturday Oct 2011

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The norm of reciprocity is firmly ingrained in our culture and is a very useful tool in negotiation situations.  If I do something for you, you feel an obligation to do something for me.  However, if the favor that we do for someone is not immediately reciprocated, the value of that favor begins to diminish in the other person’s mind. Conversely, in our mind the value tends to increase with the passing of time.  As our respective perceptions of the value diverge, the possibility increases that the favor could actually damage our relationship, because the party who has done the favor will feel that he or she has been taken advantage of, or that the other party is ungrateful.    Here are a few tips on how you can prevent this from happening.

1.  At the time you do something special for someone, mention that you know they’d do the same for you.

2.  When the time comes that you need something in return, mention how happy you were to help them out a while back when …

3.  After you’ve done them the favor, ask them if it helped them.  In other words, before too much time has passed, get them to tell you how much it meant to them.  Verbalizing their gratitude while it’s still fresh in their mind will help them remember it later.

4.  If you are the party who needs to reciprocate, try to do it sooner rather than later. When you do, mention how happy you are to be able to help the other party out in light of the recent favor they did for you.  That lets them know that you think the score has been settled.

Statements like, “paybacks are h__ll” are usually too crass.  C’mon, we can do better than that.

Reciprocity is a valuable tool in negotiation, but it’s important to manage it properly.

Enjoy the weekend, and negotiate well.

Good Agreements Make Good Relationships

15 Saturday Oct 2011

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Relationship is a crucial component of negotiation.  Our relationship with the other party in a negotiation will have a strong influence on the outcome.  A well-known tenet of fundraising, which is a type of negotiation, is that people give money to people, not organizations; development professionals know well the importance of relationship in procuring philanthropic gifts. Furthermore, the very act of coming to agreement with someone creates and amplifies a relationship.

But relationship can work against us if we let it get in the way of common sense.  Sometimes we think that because we have such a good relationship with someone, we can skip some steps.  But in any negotiation, regardless of how good the relationship may be, it’s important to discuss all the issues. Don’t assume that the other party is in agreement with something, unless you have discussed it.  It’s better to bring everything out now than find out later that there is a point of disagreement that you failed to address, because you thought any reasonable person – and for sure someone with whom you have such a good relationship – would see it the same way you do.  In the moment of agreement, with the high fives, the clicking of champagne glasses and other acts of celebration, it’s important not to let the emotion and euphoria of coming to agreement cloud your thinking.  Everything is always fine…until it isn’t.

As important as it is to put all the issues on the table during negotiation, it’s equally important to document the final agreement carefully.  Don’t leave anything out, assuming that “we’ll remember that.”  People forget, people interpret things differently and people leave organizations to go work somewhere else.  In Robert Frost’s poem, Good Fences Make Good Neighbors, he reminds us that the purpose of fences is not to settle disputes, but to avoid them; you put the fence up before a problem arises with your neighbor.  Similarly, written agreements and contracts – even if nothing more than an email confirming the agreement – serve to avoid the eruption of disputes later on, and foster a good relationship with the other party for the future.
To paraphrase the beloved poet, Robert Frost, “Good agreements make good relationships.”

Negotiation Workshop at LA’s Center for Cultural Innovation

09 Sunday Oct 2011

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I’ll be presenting a three-hour workshop for the Center for Cultural Innovation in Los Angeles on November 9, 2011, from 6:30 – 9:30 p.m. The workshop will be held at the Japanese Cultural and Community Center (more location details at the link).  To allow time for interactive activities and exercises, participation is limited to 25, so if you’re interested, register soon.

Here’s the link:  http://www.cciarts.org/losangeles.htm

The Power of a Reason

09 Sunday Oct 2011

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Studies show that the word because can have a powerful influence.  In this video, you’ll get the details on this interesting research done by Ellen Langer.  The implications of it are that, when trying to persuade someone of something, we should remember to justify our request.  As you’ll see in the video, the reason doesn’t necessarily even have to make much sense.  However, note that this tactic works best when the request is comparatively small.  When the request escalates to something substantial, a weak reason doesn’t bring nearly as much positive response.

I welcome your comments on the study, and on your personal experience.

How to Re-negotiate a Bad Deal

05 Wednesday Oct 2011

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Let’s face it.  Sometimes we make deals that we later wish we hadn’t made.  Or, under the pressure of negotiation, we agree to a specific point in a deal to which we really didn’t want to agree. In hindsight, we often gain perspective on what we should have said or done to express our disagreement.  Sound all too familiar?  If this happens to you, keep in mind that it’s not too late to change things. You can try to re-negotiate.

A friend recently mentioned that he regretted agreeing to a stipulation in the agreement with his new employer and wished he had negotiated over that point.   Here are a few tips for re-opening negotiation, based on my friend’s situation, i.e., an employee/employer situation.  These tips can be tweaked to fit other situations, also.

1.  To re-open the conversation, you could say something like, “I’ve given some thought to our agreement, Joe, and I’d like to go over a few points again.  I really enjoy working here, so it’s important for me to understand your position.  When would you have a few minutes to meet with me?”

2.  When you meet with your boss, be sure to thank him/her for their time, and reiterate that you like your job.  Adopt a problem-solving attitude and indicate that you’re sure that if you put your heads together, you’ll be able to come up with a solution.

3. Use standards to argue your case.  For example, let’s say you disagree with the commission structure.  The reason for your disagreement could be based on what similar companies are paying (the standards:  fairness, competitive bids).  Whenever possible, frame your points as questions, e.g., “Other firms in town are paying 5% commission.  I know you want to have the best talent;  that’s why I came to work here.  Can you help me understand how you arrived at 4%?”  Now you’ve asked the other party to explain their standards!

If relevant, you might also craft an argument about what you need to earn to pay your bills. Though that’s your problem, it can become your employer’s problem if you quit because you can’t make ends meet (standard:  your quality of life).   “It’s important for me to be able to maintain my existing quality of life.  It affects my self-esteem, as well as my discretionary income to network regularly.” Self-esteem and networking will help you sell more, so this might have an impact on your employer; it’s the so-called WIIFM.  Follow that with a question such as, “How do you think we could resolve this?”  Perhaps your boss agrees to a monthly expense allowance for networking/ social expenses. Help him/her along by throwing in some of your ideas.   You’re not trying to get the job anymore, you’re just working together to solve a problem.

4. Your goal is to find a solution that works for both of you.  In this case, perhaps you can negotiate a sliding commission scale, benchmarks for you to meet in order to get a higher commission rate, an equivalent year-end-bonus, a car or gas allowance or a networking allowance. Be creative!

So, if you’ve made any deals lately that you’re not happy with, go forth and re-negotiate.  You’ll be glad you did!