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How to manage threats in a negotiation


There aren't going to be many discussions when your rival doesn't try to use threats to improve their own outcome. Whether it's an overt demand for a price cut (like "Drop your prices by 15% or we'll take our business elsewhere") or a more subtle one (like "It would be a shame if details of this issue were to find their way to the press"), many negotiators use threats to assert their authority and gain concessions.


Expert negotiators need to know when and how to issue threats, as well as how to neutralise threats made by their adversary.


Threat defusing techniques

When your negotiating partner makes a threat, keep in mind that the action they threaten you with is most likely the best option available to them if an agreement is not reached. Take the following example.


If Karim owes Felicia money and Karim is confident in his legal position, he could threaten to sue Felicia if they can't come to an agreement on the amount owed. Karim should consider legal action if he is unable to obtain immediate payment of at least the net amount he will get as a result of suing Felicia - taking into account legal costs, funding costs and the intangible costs of time and stress. Karim may say,


"Look, if you're not willing to offer me $75,000 then we are wasting our time and I'll see you in court."


Felicia may get the negotiation back on track by simply acknowledging that every participant has a best alternative.


"Of course you could sue me, and I feel I could sue you for the poor quality of the goods you provided. But rather than focusing on that, I'd like to discuss how we can come up with a result today that saves us both the time and stress of litigating this."


If the threat keeps coming up, you might try testing how well it aligns with your counterpart's interests or if it is feasible to attempt and defuse it. For instance, "I know you could sue us, but we're offering to settle?" It's possible you might sue us, but we've been told the law has changed, so there's nothing left to answer for.


The art of the threat

A common piece of advice I received when I first began teaching negotiation was that threats were never appropriate in an interest-based negotiation. The introduction of a credible threat, however, can often improve outcomes and bring a previously unmoveable opponent back to the bargaining table.


It's helpful to ask yourself these three questions before making a threat:

  • Why am I here? Why am I even giving thought to this threat? If you are upset and making the threat out of emotion, which is likely the case, it is best to avoid making the threat altogether. When people are angry, they often make snap decisions and act recklessly. If you find your anger rising to the surface during negotiations, it's best to take a step back and give yourself time to cool down.

  • Why would they threaten anything? – Consider the opposing side's possible options, including those they haven't mentioned. If their potential dangers are greater than yours, you should probably keep your own concerns to yourself.

  • Does the risk further your goals? – You're probably better off not saying anything rather than making a threat that could hurt or offend the other party. Angering the opposing party and reducing their cooperation in the negotiation can decrease, rather than increase, your chances of reaching an acceptable agreement.

  • Is there any way to present the threat in a way that serves their interests rather than harms them? If you want to advertise your product in the market, you can say things like, "We can work with you to find a way to continue business and protect your future debts," or "If your refusal to negotiate forces us to bankruptcy, it's unlikely you'll see much of the money you're owed."


In a negotiation, what was the "best" threat someone made against you? Share your experience in the comments.


Contact us for a free consultation if you want to find out more about improving your negotiating skills.



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