Ann Douglas, in her extensive research in bargaining, discovered that negotiators often ask for things they never expect to get. Why do they bother?
In her research interviews with many negotiators she found that they did so for a variety of reasons. Some did it to test the other party’s resolve. Others to develop trading points for winning concessions on unrelated issues. Still others did it just to satisfy the expectations of other executives in their own organization who insisted that this or that point be demanded for reasons of their own.
Negotiators rarely deal entirely for themselves. In most cases, they are part of an organization. Such an organization may be personal, as when a spouse or friend is involved, or corporate, as when the buyer’s boss or the engineering department have a stake in the outcome.
It is important for the salesperson to understand that the buyer may be asking for concessions in payment terms that their controller would like to win but that may be unimportant to the buyer. Once the buyer is requested by the controller to ask for better payment terms, they will be obligated to demand it. The buyer will probably be forgiven by the controller for not winning the concession, but would not be forgiven for failing to ask. In complex negotiations, many buyer demands are made to satisfy legal, accounting, operations, or engineering interests that may or may not be crucial.
Some demands fall into the “straw-issue” category. Straw issues are introduced by buyers to create trading room. They are put forth as demands only to be exchanged for other things the buyer values more highly. Early in the negotiation, it is not easy to differentiate between straw issues and those the buyer really wants. Later, most straw issues disappear, especially as closure comes near.
For these reasons it makes sense for sellers to defend their price with tenacity. The buyer may have less resolve in winning concessions than it first appears. The only way to find out is to patiently test their resolve. Buyers know they cannot win on all issues.