|
|
Sometimes, however, and more commonly in business negotiations, buyers threaten deadlock to panic sellers into price rot. This is a dreadful disease - painful and sometimes terminal. Buyers threaten sellers with a phrase like 'Unless we can agree to this price reduction, I see no way forward.'
Sellers can succumb to the threat, and in doing so rot their price structure for ever. They can dig their own heels in, declare an immovable position, and counter-threat. That is not always wrong; it can call their counterpart's bluff. Most appropriately, they can defend their price but trade concessions.
The moral is simple: don't allow the threat of deadlock to panic you into price rot as a seller, or a price hike if you are the buyer. How do we avoid that in practice? Well, we need a bridge.
|
|