Five Important Negotiation Principles For Consideration

Don’t Negotiate Your Own Deals. In an ideal world, you would never negotiate your own deals. The first reason for this is obvious – if you’re a creative or an executive, you have to operate in multiple different capacities and wear a lot of different hats. An experienced professional negotiator – whether lawyer or agent – who spends all day, every day negotiating is likely to be more skilled and have more insight into the marketplace than you. The second reason is perhaps less obvious to laypeople, which is the benefit of detachment and plausible deniability. Even if you are a master negotiator, there is always a benefit to having someone else negotiate in your place. You can instruct them to take certain actions with less risk of jeopardizing your personal, creative or business relationships with the other side. You can use them to test the waters with the other side. And, if needs be, you can detach yourself from (or even politely disown) their responses if there is a negative reaction. Your representative is there to help facilitate the deal and relations with the other side – but on occasion you may wish to use them as the “bad guy,” and you should not be afraid to do so.

Don’t Make Gives To Try to Accelerate Deals. Inexperienced negotiators often try to accelerate the pace of a deal by readily agreeing to terms and surrendering positions. While there are exceptions, this strategy generally does not yield positive results. An experienced negotiator will often respond to attempts to push a deal through by slowing the deal down and thus seeking to increase the desperation of the other side to close. If an initial proposal or response has been met with an accommodating response from a party visibly keen to close, an experienced negotiator may respond by making more asks. In the entertainment business at least, absent a very compelling reason to close (e.g., principal photography needs to start, a financing needs to close, or a producer is about to lose an actor) most deals take a certain amount of time irrespective of their complexity or the efforts of one side to be efficient.  

Negotiate Every Term. The worst response that one can give to a proposal is “this all looks great.” The second worst is “this all looks great, except [insert one or two comments].” At least at the early stages of a negotiation, it is imperative that you negotiate every term. This gives you multiple levers to pull later in the negotiation, rather than having one issue or two left and no leverage whatsoever. You also don’t know exactly what the priorities are to the other side (and in entertainment, of course, the non-monetary terms are sometimes as important as the monetary to clients), so why surrender something unnecessarily? Never agree to everything – and this is particularly true if you are an individual negotiating against a seasoned lawyer or talent agent (don’t do this!) because the proposal from the other side may include nuances or phrasings that perhaps you don’t understand but are drafted in a manner highly favorable to the other side.

Take Your Maximum Plausible Position. I took this concept from “Secrets of Power Negotiating” by Roger Dawson, which for my money is the best book ever written on negotiation. You should always take the position that is the most favorable to you while still being believable and justifiable. That means making the lowest possible plausible offer for something if you are the buyer, or responding with the highest plausible counter if you are the seller. And you should always assume that the other side is taking its maximum plausible position as well (another reason why you should never, ever agree to the initial proposal – even if the other side says that it is “trying to get this done quickly” or “cutting to the chase”).

Email Terms are Binding. Inexperienced negotiators sometimes don’t understand that a signed contract is not always necessary for there to be a binding deal. Depending on the state that you’re in, a closed deal over email can be legally binding, and even in states where that’s not the case, closed email deals are often considered binding in principle within the United States film and television businesses. That means that the right time to engage a representative is when you receive any offer – whether it’s a formal contract, email offer or note sent by carrier pigeon. Once you’ve agreed to something, it can be hard (and expensive) for your representatives to try to change the deal.