Who Should Make the First Offer?
Conventional wisdom has always warned against being the one to make the first offer during negotiations, strongly advising us to wait for the other side to go first. This point of view insists that the party making the first offer rings a bell that can never be un-rung, that it shortens the playing field, and that it sets a limit on the best deal the offer-making party can ever expect to receive.
However, there is now another professionally accepted school of thought regarding the advisability of making the first offer.
On the other side of the conventional wisdom coin, many top negotiators now believe the that the party making the first offer will gain a superior bargaining position. They feel the first offer indicates strength and confidence and anchors the settlement talks in the offer-making party’s chosen bargaining zone.
Both schools of thought recommend that the parties try to delay getting to the first-offer stage. If the big demands begin too early, the walls of defense start going up prematurely and are likely to snuff out the interchange that is usually needed to serve as foundation for the big demands.
If you do make the first offer, do it politely and explain why you believe it meets the applicable standard. Always indicate flexibility in your price, and do not start at your bottom line because this leaves no room for compromise.