Get What You Want: 5 Ways to Win Every Negotiation

1. You must be fearless when negotiating. You cannot let them bully, intimidate or frighten you. Remember, you hold all the cards because you can walk out whenever you want. There are plenty of other places for you to spend your money.

2. You have to know what you want. Walking into a negotiation blind is suicide. You must have an idea of the final outcome and then you need to keep that secret. Don't walk in and lay your cards on the table, but play the game. That means you need to do your homework. You need to know what the item really costs and then negotiate from that position. Fortunately the Internet has all that information available.

3. You need to make sure you are negotiating with a decision maker. Don't waste time haggling with junior personnel that cannot make decisions. Ask to speak to someone with the power to negotiate and make it clear you will only speak to them.

4. You must follow through then-and-there. If you get what you want from the negotiation, you must commit to the sale on the spot. If you come back later you will need to re-negotiate with whomever is present and you will have wasted everyone's time. Don't enter into a negotiation if you don't have the money to pull the trigger.

5. You need to get tough. There is a point in time in every negotiation where you will need to get tough. It is critical that you do this at the right time. It is that moment when the parties are all tired and the other side has drawn a proverbial line in the sand. That is the moment you must go on the offensive and make it clear you are not afraid to walk away from the table.

For example, I bought a car for my wife two years ago. We came in close to closing time so I could benefit from the staff's exhaustion from a long day of work (I'm evil.). Throughout the entire negotiation, the salesman kept ignoring incoming phone calls on his cell phone. The entire time we were haggling, he kept hitting the Ignore button on that cell phone with a look of growing concern. Finally, he drew that line in the sand and I pounced:

"Look, buddy, I want to buy this car but I am not paying that price. We've been here for more than 2 hours arguing because you refuse to see reason. Right now, your girlfriend is throwing that nice dinner she cooked for you into the trash. She's changing out of that sexy nightgown and putting on that horrible, nasty nightshirt because she's furious that you haven't answered any of her calls. I wouldn't be surprised if she isn't calling some other guy right now, all because you are being a pain in the ass over $1000. Either come down, or I'm walking away and you get nothing at all tonight."

I wish I had a picture of his face; all his resistance collapsed. I took him apart because I correctly assumed that all those phone calls where from his girlfriend. Do I feel bad for wrecking this man? Hell no! I got the price I wanted and my wife drive home in her new car. He got a commission check and a chance to make up with his girlfriend.

The point is, in every negotiation you have to wait for that magic moment and then attack. Once they believe you are prepared to walk away, you will win. Try it and let me know how it works out for you in the Comments section below. I can't wait to hear from you.

Comparison Shopping

SmartMoney.com published a great review of the top online price comparison sites. For the most part I agree with their findings. Their reviews found PriceGrabber.com was the superior website for comparison shopping. One of the better features included on PriceGrabber.com is the ability to setup alerts for products based on your desired price range. With the constantly declining costs of technology products, it doesn't make sense to pay bleeding edge prices.

They also rated Yahoo! Shopping, Shopping.com and NexTag as good sites. Rated towards the bottom was Google Products (AKA Google Shopping) because it provided poor details on listings. In their defense, Google says the tool is simply a way to find products and the stores that sell them.

Regardless of what online tool you use, now there is no excuse of overpaying for any product. My advice to you when using these price comparison tools is to perform searches by the part number of the product you want. For example, if I know that I want a specific 3Com network switch, I look up the part number on 3Com's website then I plug that part number into PriceGrabber.com. This ensures that I get the exact item I am looking to buy.

Happy shopping.

The True Costs of Free and Low-Cost Software

I found this great article from Idealware. Click here!

If you run a non-profit, this site is a great resource for you. I recommend you subscribe to their updates.

Idealware, a 501(c)3 nonprofit, provides candid Consumer-Reports-style reviews and articles about software of interest to nonprofits. Through product comparisons, recommendations, case studies, and software news, Idealware allows nonprofits to make the software decisions that will help them be more effective. http://www.idealware.org/

Dark Side of the Cloud

While I am a big fan of Cloud Computing, it must be noted that there is a dark side. Salesforce.com, which provides hosted customer relationship management services, suffered a 38 minute service outage on January 6, 2009. While many want to shout and scream that this was a terrible problem, it was ultimately as damaging as a power outage.

The majority of quality cloud computing service companies maintain 99.99% reliability. This means that outages are sufficiently rare that they are negligible. Utility services will suffer occasional outages. That is just the nature of the beast. However, for the cost benefits, these outages are completely acceptable.

And the beauty is if the outages are too frequent and directly imapct your business, you pull up stakes and go somewhere else. So, a word to the wise, be aware that the Cloud Paradigm offers phenomenal cost saving opportunities but it also includes a few risks you should be aware of.

Understanding Risk: The Fine Line Between Insanity & Inner Peace

The investment community calls it Risk Tolerance but back where I grew up, it was called The Hit. It all boiled down to a simple question: how much can you afford to lose? How big of a Hit are you able to take? Everyone has a different answer. The secret to taking risks is to know that answer. How much of a Hit can you take? When you know that answer, you will sleep much better.

Now, for most people, that Hit comes with a dollar sign attached, though not always. The next question is how much money can you lose? Obviously, during hard financial times, that answer is Very Damn Little. The problem is that no two situations are the same. So, now we need to be flexible with that dollar figure depending on a simple analysis. You need to ask yourself a simple question: Is the amount of money involved worth the risk of checking out the offer?

Let's face it, we have all fallen prey to a great salesman who promises the world and delivers a complete piece of junk. I bought a lovely mop-thing that exploded into a dozen pieces in my hands three days later. But I really didn't care because it cost $5. At $5 my risk tolerance is pretty high. I can afford to make a bet on the product or service.

Now, a $5 mop-thing is the low-end example. Risk tolerance starts getting complicated the larger the dollar signs. As the numbers climb, so does the anxiety. Obviously these are the decisions you must weigh carefully. I think you know what I am talking about, so I'll move along...

Protecting Yourself
Now that you know more about hidden costs, you know that you have to do your homework. The questions you must ask are:

• Do the advantages out weigh the disadvantages?


• Will the learning curve be a problem?


• Will this be disruptive?

You need to answer those questions in as much detail as possible. You've got to do your homework! You need to take your time and get those answers.

Homework

1. List out all the advantages and the disadvantages; you need to assign them a dollar value based on their benefit to your business. Try to be as accurate as possible. Add both columns and then subtract the disadvantages from the advantages. If you were accurate in assigning dollar values you will have an honest assessment of the financial value of the purchase.


2. Examine manuals and online product reviews. How do users of the product feel? The Internet has liberated countless voices. See what people are saying. Don't just read one review! Get multiple opinions while working to build a consensus. Get a demo, if possible, and get your team involved. If they are part of the selection process, they will accept your decision easier.
   
3. How long will it take for your team to get up to speed with this product? Every day you lose productivity there is a real dollar value involved. The longer you are getting up to speed, the more it costs you. No matter what, you should never try to "go live" on any new product or service during your industries "busy" season. So, if you are in retail, December is a bad month to be testing new mission critical systems. Plan new product deployments during your slow seasons, when possible.
   
4. And finally, the great bogey-man: Will it be disruptive? This is the hardest question of all. Every change brings some disruption. It is inevitable. The problem is will the glitch cause your business to grind to a terrible halt? Will this bug cause me to lose money? Every change brings risk, sometimes they are catastrophic. The real question to ask is can you reverse the distruption quickly. Can you just uninstall the software and get back to normal? Can you just unplug the crazy gizmo and everything will be OK? Find out.

Inner Peace & Other Myths
Sorry to burst your bubble, but some people are just naturally wired for stress. If you are one of these lucky winners, it will take lots of meditation and whatever else the yogis prescribe before you will have inner peace. As for the rest of the world, once you understand how much of a Hit you can take and you have done your homework, you'll sleep well.

Nearly Free IT

Could your business benefit from better organization, painless backup and a virtual engineer? What is it worth to you to have a computer that runs fast, safe and error free? How much money would you save if you could be warned before your computer broke? Aren't you tired of paying through the nose to repair your computer? Geek Squad charges $160 just to install a new computer! Most computer techs charge insane hourly fees to sit and stare at the damn hourglass on the computer screen.

You work too hard to spend your money foolishly! You deserve Nearly Free IT! Find out how you can get it all for under $20!

Impossible you say. Ridiculous. Insane. No way.

You wanna bet???

Find out how you can get:

• Easy to use project management: you can't make money if you aren't organized.
• Elegant customer management: keep them happy so they spend more money
• Centralized team management: a good team is vital to success
• Business chat tools: communication is the key to a good team
• Delegate responsibility: build quick to-do lists and share them with others
• Document collaboration: so you can work together to finish faster
• Painless backup: with your data safe, you can sleep peacefully
• Predictive failure: know before it breaks, so you can fix it first
• Malware protection: protection from viruses, trojans, spyware, and the latest Internet nasty, rootkits.
• Virtual engineers: you deserve 24/7/365 computer monitoring by brilliant, experienced engineers who will maintain your computers and fight hackers

All for under $20! Discover Nearly Free IT.

Sign up for the TOTAL 100% FREE Five-Week Nearly Free IT e-Course that will teach you everything you need to know to get it all.

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The Hidden Costs of Free Software

With all the free software available online, you must be aware of the hidden costs before you run the risks. If you know the hidden costs ahead of time, you can plan accordingly.

Some examples of hidden costs include:

1. Learning Curve
   Every software takes time to learn. Many free programs don't have the benefit of professional human interface development, so you get an interface designed by an engineer. Unfortunately, engineers don't necessarily think like users so they may layout the interface in a difficult to understand manner.
   
   I remember one particular 3D design software that included some of the most amazing features I had ever seen. The only downside was the impossible number of buttons that completely cluttered the interface making it impossible to work comfortably.
   
   Make sure you have an idea for how difficult it will be to learn the new, free software. If it will significantly impair your productivity then you might be better off looking somewhere else.
   
2. Malware
   Too many free, online products come laden with all sorts of nasty surprises. In many cases these viruses, trojans and rootkits will sneak past even the best anti-virus software during the installation process. Before you download and install anything, make sure that it has been certified free of viruses and other malware by a respected third party authority. When in doubt, you can always contact R-Squared Computing and we will perform a full analysis of any questionable software for you.
   
3. Ads/Spam
   Some free products defray their costs by placing banner advertisements inside the software. While this is usually not a problem, you might be concerned that it will make your business seem less professional if you have programs running with ads.
   
   Many free software providers will require that you provide them with an email address so they can send you offers. Sometimes, even though they say otherwise, they will sell your email address to other Internet marketers. Everyone has had the experience where they sign up for a newsletter and suddenly are inundated with junk mail.
   
   A good strategy to use whenever an online vendor asks for your email address is to provide them with a spam trap. Just create an email account with any of the multiple free email services like Yahoo! Mail or Gmail. Then use that email address whenever you are asked to provide an email online. If you want to be nice, you can check that account ever so often to clean out the junk. If not, who cares?
   
4. Buggy/Error Prone
   You get what you pay for, sometimes. That means you might get software that has quirks and errors. These bugs can be a nuisance but they might still be better than paying for the similar commercial product. You can learn all about bugs and known issues by using the Internet to read reviews on the various free products available.
   
   You should never just rely on one review! You never know what the reviewers motives are, so be sure and check multiple reviews. The beauty of the Internet is the liberation of opinions and everyone online seems to have their own opinion on something. Check these opinions and make smart choices.
   
   Anyone that has used Google Documents will attest that the service has been in Beta stage forever. Beta software is any product that is stable enough for wide testing but is not really ready for commercial distribution. It also means that new features are still pending and will be made available later on. Beta products are notoriously buggy and prone to failure so always be careful when you work with beta products. Never rely on beta software for missionb critical needs!
   
5. Availability
   If you are using online software, such as the aforementioned Google Documents, you should be aware that service outages will occur. The most recent Google Documents outage shut down several businesses for two days. Be aware that availability is always a concern when dealing with online software delivered as a service.
   
   Obviously this also extends to your Internet service provider. If your Internet has a habit of going down for long periods of time, you should look for a new provider. Until you have a more stable Internet service, you should avoid all online software offerings.
   
6. Missing Features
   When it's free, you can't complain about what you get. Some free products may mimic commercially sold products very closely but there are usually some missing features. To stay with the Google Documents example, Microsoft Word offers a significantly better set of features for word processing. However, MS Word will run you about $200 against Google Documents price tag of $0. If you can live without the missing features then it's a no brainer to choose Google Documents. But if you need those missing features, you have to either buy Word or examine other free word processing software titles.
   
   To make good decisions you will need to know the features used by your employees in their daily work. Once you have identified all the required features you can begin to examine the available offerings. Chances are you will be able to find a product that meets all your needs. Now you just need to check it against the other five items on this list of hidden costs.

Obviously these are not the only kinds of hidden costs. I am sure you can think of a few that are not on the list. The idea is to examine carefully every software product to ensure it is a good fit for your business before flying off the handle. Don't jump too soon just because it's free.

Understanding Opportunity Cost

The opportunity cost of a resource is the value of the next-highest-desired alternative use of that resource. For example, if you spend time and money at a movie, you cannot spend that time at home reading your favorite blog and you cannot spend the money on something else. If your next-best alternative to seeing the movie is reading this blog, then the opportunity cost of seeing the movie is the money spent plus the pleasure you forgo by not reading the book.

Take a student who pays $4,000 for tuition to Miami-Dade College. Assume that the same student also receives an $8,000 scholarship. Therefore, the cost is $12,000 and the student pays only 1/3 of the total tuition. However, the true cost to the student is $12,000 plus the lost income the student could have earned instead of going to school. If the student could have earned $20,000 per year, then the true cost of a year’s schooling is $12,000 plus $20,000, for a total of $32,000. Of this $32,000 total, the student pays $24,000 ($4,000 in tuition plus $20,000 in forgone earnings). That is the opportunity cost. It's how you could have spent money or time if you had chosen another path.

Incidentally, opportunity cost is not the sum of all the available alternatives when those alternatives are mutually exclusive. So, if the student could have had a choice between the $20,000 a year job or a $50,000 grant to build houses in New Orleans you do not include both in your calculations.

Opportunity cost isn't just measured with money; it can be anything valuable. For example, in a restaurant, the opportunity cost of eating a steak could be trying the salmon. Ordering both meals could cost more than double - not just the extra money to buy the second meal but the cost to your reputation if you appear gluttonous or extravagant for ordering two meals.

Calculating opportunity costs is fundamental to knowing the real cost of anything. When there is no accounting or monetary cost (what accountants say instead of "price") for an action, ignoring opportunity costs may produce the illusion that it's free. These opportunity costs then become the hidden costs which can come back and bite you.

Now, it's time for a reality check. It is possible to take this too far. If you keep mapping out possible alternatives with fanciful opportunity costs you will quickly drive yourself insane. Don't do it! Keep it real and don't go to extremes with this tool.

Opportunity cost is an important tool to help you understand the real costs of any decision. The cost of the alternative use of a resource must always be taken into account when trying to understand the costs of any decision. Opportunity costs are not totally cumulative when examining mutually exclusive options so be careful when listing the alternative uses for resources. Remember, money is not the only resource! Be sure to measure all the resources in use before committing to a course of action. Finally, don't let calculating opportunity costs paralyze your ability to make a decision. Like all tools, opportunity cost is best when used wisely.


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Sources:
Henderson, David R. Opportunity Cost: The Concise Encyclopedia of Economics
Wikipedia: Opportunity Cost

Technology Enabled Micro Business

A micro business is defined as any business with 1 or 2 employees. With the power of modern technology these businesses have an equal chance to achieve lasting success. Hard work, dedication, quality, exceptional service and exceeding expectations are still required.

The internet has leveled the playing field. A new startup doesn't have to create a bigger and more expensive product or service than the competition. Actually, current internet success stories argue for the exact opposite. The most successful new internet companies are not engaging in the traditional business cold war of feature escalation.

These companies are focusing on providing fewer features to control their costs. But they are also ensuring that the features they do offer are well executed and easy to understand. They are taking the time to distill the actual useful essence of the product into a viable competitive product. Focus on solving the simple problems that people have and leave your competition to choke on the complexities.

For example, in the book Getting Real, by 37signals, the developers of Basecamp write how they chose Microsoft Project as their software "enemy." A good project management software should not be about charts and graphs, they argue, but about collaboration between team members set on completing the task at hand. The top-down dictatorial approach embodied by Project was not the ideal way to operate in the new web enabled world.

With the wealth of available tools and the power of direct outsourcing, micro businesses are proving to be capable competitors. With the amazing tools available online, it is now possible to do the impossible. What is clusmily called Web 2.0 has opened the floodgates for new businesses to provide remarkable products at low costs and still exceed customer expectations. The old business models required enormous overhead to, hopefully, achieve these goals. The old ways are dead; it's time to embrace the new paradigms.

Hidden Costs

Hidden costs lurk in every possible purchase. They lie in the shadows waiting for the unsuspecting. Suddenly that product or service that is supposed to save you money, suddenly costs you double. We have all experienced the torment of fees, costs, taxes, fines, honorariums, markups and surcharges. Know before you buy and you will avoid these nasty surprises.

Hidden costs include changes to your business processes. This means you will need to change how you work in order to use the new product or service. There are always significant costs involved with a process redesign so make sure you map out all the necessary changes and the associated costs before you make a decision.

For example, large software purchases are typically laden with hidden costs. The implementation of an Enterprise Resource Planning (ERP) software can quickly turn into a neverending money pit. Hidden deep in the fine print of all ERP product literature is the warning that a significant redesign of company processes is a fact. If you don't plan ahead and include the costs of these changes, you will be in for a nasty surprise. You would think that the steep price tag on ERP systems would be all inclusive. Don't get caught by surprise!

Hidden costs come in all shapes and sizes so you must spend the necessary time examining all the elements involved in implementing the new purchase into your business. If you are cautious and work dilligently, you will find them and know what you are getting into. Don't rush in blind and never let someone force you into an untimely decision. The best salesmen are experts at forcing an early decision. The more money you are looking to spend, the longer you should study it. Take your time; if it's a good buy today, it will still be good tomorrow.