Monday, August 01, 2005

People are never happy

My mom used to say "Pigs get nothings" (is that correct sar?) If only this were true in business

I've been meeting with administrators recently, introducing them to my companies program, and hoping that they sign on with my company. As part of the program, we offer them a percentage of the media dollars we'll say 40%. We also offer a percentage if they refer us, successfully, to another District.

I don't know about you, but I'd be happy receiving 40 percent of profit, Especially if I have to do nothing but say "go ahead" but not these people. Everyone wants more, "How bout an extra 10 percent, we'll go 50-50". "We want extra referral fees".

Don't these people realize that we are in business to make money, not give them all half our money just to receive their approval?

I think if we tell them right off the bat they would receive only 30 percent, they'll negotiate up to 40 percent, they'll feel like they won, we will pay out what we initially planned and everyone will be happy.


At 9:25 PM, Blogger Yishai said...

heh. that doesn't sound like a bad idea. Maybe they are thinking that you really are willing to go for 50% because you are only asking for 40. But then again, it is very valuable to be known as a guy who means what he says - I said 40, I mean 40. We have a term in the jet engine business - FFP, Firm Fixed Pricing. That means that we know you'd like a better deal, but this current price is the best we can give you within our current business model. For FFP to work, though, you have to be willing to walk, if they balk.

At 9:47 PM, Blogger stillruleall said...

Bring a turkish rug and some coffee, to set the mood, and offer them 5%. Then let the bargaining begin!

At 1:43 AM, Blogger Olah Chadasha said...

I agree with yishai. They feel they can bargain. You have to either start at a lower percentage, knowing that they'll try to go up. Then, when they hit the price you're both comfortable with, you'll both feel like you've won and be satisfied. Or, like yishai said, be the guy that won't bargain. However, that might be dangerous for now, as your business is new and just starting to get off its feet. Either, you need these guys' business, so play the bargain game. Or, you don't need them, and be firm.


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