Regarding negotiation, low-balling and high-balling don't make sense in all situations. Especially if you are in a situation where the relationship between the negotiating opponents after the transaction is important.
I agree that there are circumstances where high/lowballing isn't appropriate: You don't go to a long-time customer and start negotiating for 10x the cost for the same service. But in the case of a new contract, that highballing will set the course for the following deals. You get more at the start, and the following deals will all follow a similar price-point.
Furthermore, by demanding high at the beginning, and then coming down, the person with whom you're negotiating will feel as though he/she "won" the negotiation, due to the huge concessions you made "He was asking a million dollars for a plan and we got him for $250k."
My point is you can highball and still have a solid post-negotiation business relationship.
I will definitely be checking out your book recommendations though.
I agree that there are circumstances where high/lowballing isn't appropriate: You don't go to a long-time customer and start negotiating for 10x the cost for the same service. But in the case of a new contract, that highballing will set the course for the following deals. You get more at the start, and the following deals will all follow a similar price-point.
Furthermore, by demanding high at the beginning, and then coming down, the person with whom you're negotiating will feel as though he/she "won" the negotiation, due to the huge concessions you made "He was asking a million dollars for a plan and we got him for $250k."
My point is you can highball and still have a solid post-negotiation business relationship.
I will definitely be checking out your book recommendations though.