Listening Questions

1) The basic source of disagreement between Maxine and Peter is price – Maxine

will not sell business for less than €15 million; Peter “can’t do better than,”

that is, can’t offer more than €11.5 million.

2) Maxine says that the market is going nowhere but up – that is, continuing to

expand – and she says that she’s got “tremendous value here – good people,

good products, and a solid business plan.”

3) Due diligence refers to doing careful research before a big purchase or other

major life decision.

Language Review

A. Useful Language

Clarifying positions

1. If I understand the position correctly, you are looking for better credit

terms, am I correct?

2. As we see it, this is the position at the moment:

3. How do you see our objectives?

4. Can I just summarize our positions as I see them?

Evaluating the position

Positive

5. Despite a couple points of minor disagreement, the arrangement under

discussion obviously has a lot to offer both sides.

6. Though there are still a couple of loose ends to tie up, we feel

overwhelmingly positive about the compromise that we’ve reached.

7. This is a good offer – no doubt about it.

Negative

8. Honestly, this offer leaves a lot to be desired, in our point of view.

9. We’ve looked at the figures closely, and I can’t say that we currently have a

very high appraisal of this deal.

10.At this point, I think it’s really tough to see where the value is for our side.

B. Giving Reasons

1. Let me explain why we have reached this conclusion.

2. I also have to take into account many other factors.

3. There are several aspects to this situation.

4. I would just like to briefly run through seven points that explain our position

on this.

Online Activities – Flash Quizzes

(click above to open)

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Online Activities:

M

P

3

P

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d cast:

BEP 406 – Declining an Offer while Maintaining Goodwill

This episode will focus on declining an offer and what to do when someone

declines. It is part of an ongoing series on negotiation skills.

Negotiations don’t always go according

to plan. Disagreement is part of life. But

to build lasting relationships, coping

with failure is even more important than

celebrating success. So in this show,

we’ll examine a deal that does not get

completed. We’ll look at making a final

offer

as

well

as

expressing

dissatisfaction and regret. We’ll focus on

maintaining goodwill even when talks

break down.

Peter is the owner of mobile phone ringtone and game provider, Textacular. He

is in discussions with Maxine about buying her company, Gamester. Eventually,

Peter wants to sell his business to a larger, regional service provider for a profit,

so he is attempting to roll up or buy other small companies to increase the value

of his business. But Maxine wants €15 million for her business, and Peter isn’t

prepared to pay that much.

As you listen, pay attention to how Peter makes a final offer, how Maxine

declines it, and how they both work to maintain goodwill.

Listening Questions

1) What are Maxine’s reasons for staying firm on price?

2) What does Peter say to justify not being able to pay more?

3) How does Maxine leave open the possibility for future cooperation?

© 2009 All rights reserved: www.business english pod.com 57

Successful Negotiations

Vocabulary

To take into account: To consider. “We need to take into account volatility in the

market.”

Redundancies in sth.: (Often useless) repetition or overlap. (Can also refer to lay

offs – To make s/o redundant means to fire him or her.) “A merger is possible,

but there are a lot of redundancies in our business model, so it’s going to be

necessary to make cuts.”

To factor in sth.: To consider or include sth. in your thinking. “We should factor

in the price of oil when we draw up our business plan.”

Volatility in sth.: Volatility refers to quick or unexpected changes in price and

values, for example in stock prices, in a market, or in a industry. “Such high

volatility in the market can make it difficult and risky to put a value on a

company.”

Synergies (in sth.): Ways in which the whole is greater than the sum of the

parts (1 + 1 is greater than 2). “Experienced negotiators search for synergies in

order to make a deal that creates value for all sides.”

To outweigh sth.: To be more important than sth. “At this point in our growth,

the need for steady development outweighs the need to take risks.”

To run the numbers (on sth.): To make the calculations. “We ran the numbers

on the merger, and we think their stock price is way overvalued.”

The way a deal is structured: Detailed arrangements of a business transaction,

including, for example, credit terms, payment period, timing, and so on. “The

way a deal is structured is sometimes more important than the price being

offered.”

There’s no two ways about it: There’s no alternative interpretation, no different

way of looking at it. “There’s no two ways about it – we’ve reached an impasse.”

To resolve differences: To solve problems or overcome disagreement. “We

encountered blockage early on, but later we were able to resolve our

differences.”

To reach an impasse: To encounter an obstacle or blockage. “We couldn’t agree

on price, so we reached an impasse there.”

To be too rich for someone’s blood: To be too expensive for someone. “I’m sorry

– I can’t pay that much. It’s too rich for my blood.”

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Dialog

[Part 1 of the dialog from BEP 405]

Maxine: So in short, we’ve thought about it a lot, and we really can’t budge

from our position.

Peter: So if I’m getting you right, you won’t be willing to part with Gamester for

less than 15 million, right?

Maxine: Yes, that’s an absolute minimum. Let me go over my reasons again.

Peter: Go ahead.

Maxine: For one, this market is going nowhere but up.

Peter: Yes, I take your point.

Maxine: For another, we’ve got tremendous value here – you’ve seen the

figures: good people, good products, and a solid business plan.

-------------------------------

Peter: I’ve done months of due diligence, and I’m convinced of the value of a

merger.

Maxine: I know you are, but we need a fair price for our business.

Peter: On my side, though, we must take into account redundancies in our

business operations and factor in the volatility in the market.

Maxine: As you know, we think the synergies will outweigh all that.

Peter: Yes, but we’ve run the numbers, and, depending on how the deal is

structured, I can’t do better than €11.5 million.

Maxine: Well, there’s no two ways about it. That doesn’t give us much more

to talk about.

Peter: Well, I’m really sorry to hear you put it that way. I was really hoping we

would resolve our differences.

Maxine: Yes, but, anyhow, I think we should explore other possibilities for

working together.

Peter: Absolutely. I look forward to it.

Debrief

Although Peter and Maxine disagree, they end the discussion in a cordial, or

friendly, manner: The possibility remains open for future cooperation. Let’s look

closely at the language they use.

The dialog starts off with Peter giving his reasons for not being able to pay

Maxine’s price of €15 million.

Peter: On my side, though, we must take into account redundancies in our

business operations and factor in the volatility in the market.

Maxine: As you know, we think the synergies will outweigh all that.

To take into account and to factor in both mean to consider. Peter says he must

“take into account” redundancies in their business operations, in other words,

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Successful Negotiations

areas of repetition or overlap. Likewise, he must “factor in” volatility in the

market. Volatility refers to quick or unexpected changes in price and values, for

example in stock prices or in an industry. High volatility can make it difficult or

risky to put a value on a company.

Maxine has a different evaluation from Peter, however: She believes synergies in

their operations will outweigh – or be more important than – all the factors Peter

has mentioned. To review, synergy refers to a situation in which the whole is

greater than the sum of the parts, in other words, a situation in which 1 + 1 is

greater than 2.

How does Peter reply to Maxine? He makes his best offer. Let’s listen again.

Peter: Yes, but we’ve run the numbers, and, depending on how the deal is

structured, I can’t do better than €11.5 million.

Peter has “run the numbers,” or analyzed the financial information. Depending

on how the “deal is structured,” – which refers to credit terms, payment period,

and so on – he “can’t do better than €11.5 million”. That is his final offer.

Listen to some other example phrases for making a final offer.

 That’s already just about as far as we can move on this issue.

 We’ve already made many concessions, so we need to hold firm at this point.

 If we bend any further, we just won’t be making any money on this deal.

 The only way we’re going to reach agreement is by taking a win-win

approach.

 That’s our final offer.

Maxine has also reached a point where she cannot make any more concessions.

She makes this clear by expressing her dissatisfaction with Peter’s offer.

Maxine: Well, there’s no two ways about it. That doesn’t give us much more

to talk about.

“There’s no two ways about it ” means there’s no other way to look at it – no way

forward.

Sometimes it’s important to express that we are not satisfied with a proposal. In

some situations, being clear about your feelings may actually help overcome

blockage.

What are some other ways to express dissatisfaction?

 Unless your side takes a different approach, at this point I just don’t see any

clear way forward.

 Face it. We’re wasting our time.

 Frankly, we’re not satisfied with the offer on the table.

 We seem to have reached an impasse.

 That figure is just too rich for our blood.

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To reach an impasse means to encounter an obstacle or blockage. To be too rich

for someone’s blood means to be too expensive for someone.

Next in the dialog, Peter replies by expressing regret that he and Maxine were

unable to reach agreement.

Peter: Well, I’m really sorry to hear you put it that way. I was really hoping we

would resolve our differences.

Though he and Maxine have a difference of opinion, Peter is careful to maintain

goodwill. He avoids getting angry or accusing her. And he leaves Maxine some

room to change her mind – his statement that he is “sorry to hear her put it that

way” leaves open the possibility that she may put it another way another time.

Peter’s expression of regret helps defuse or relax the situation. Then, he ends on

a positive note – he says, “I was really hoping we would resolve their

differences.”

Can you think of other language for expressing regret? Listen to some examples.

 I’m sorry to hear that you feel that way.

 It’s too bad that we see things differently on this issue.

 Well, obviously this is frustrating for both sides.

Maxine ends the conversation politely to leave the door open for further

discussions.

Maxine: Yes, but, anyhow, I think we should explore other possibilities for

working together.

Peter: Absolutely. I look forward to it.

Of course, even when we’re feeling frustrated, it’s usually wise to keep the

possibility open for future negotiation.

Let’s examine some similar phrases that can create goodwill when we’ve reached

an impasse.

 Obviously, though, there are other areas where we’ll be able to work

together.

 I would still like to emphasize how much we appreciate our partnership.

 Despite our differences of opinions, we are committed to a long-term

partnership.

 Your support means a lot to us.

Practice 1

Now, let’s practice some of what we have learned.

First, imagine you are negotiating with a client. Your talks have encountered an

obstacle. First, based on the cue, make a final offer. Then the customer will

express dissatisfaction. Finally, you should reply by expressing regret.

© 2009 All rights reserved: www.business english pod.com 61

Successful Negotiations

For example, if you hear:

Hold firm on this point. <beep>

You can say something like:

That’s the best we can do. We need to hold firm on this point.

Then the client will reply with dissatisfaction, for example…

Face it. We’re wasting our time. <beep>

And you can respond by saying something like this:

I’m sorry to hear that you feel that way.

Are you ready? Let’s give it a try.

Exercise 1

Example cue 1: Cannot bend further. <beep>

Example learner 1 – final offer:

Example client 1 – dissatisfaction: Frankly, we’re not satisfied with the offer

on the table. <beep>

Example learner 1 – regret:

Now, let’s try it again.

Exercise 2

Example cue 2: Already as far as we can move. <beep>

Example learner 1 – final offer:

Example client 2 – dissatisfaction: Unless your side takes a different

approach, at this point I just don’t see any clear way forward. <beep>

Example learner 1 – regret:

Great. Now listen to the example answers.

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Answer 1

Example cue 1: Cannot bend further. <beep>

Example learner 1 – final offer: That’s our final offer. If we bend any further,

we won’t be making any money.

Example client 1 – dissatisfaction: That’s just too rich for our blood. We

seem to be wasting our time. <beep>

Example learner 1 – regret: I’m sorry to hear that you put it that way.

Answer 2

Example cue 2: Already as far as we can move. <beep>

Example learner 2 – final offer: We’ve already made many concessions.

That’s already as far as we can move on this point.

Example client 2 – dissatisfaction: Unless your side takes a different

approach, at this point I just don’t see any clear way forward. <beep>

Example learner 2 – regret: It’s too bad that we see things differently on this

issue.

Practice 2

Okay, now let’s practice useful collocations. You’ll hear a series of sentences with

a word blanked out or replaced with a beep. Repeat the whole sentence, but say

the missing word.

For example, if you hear…

We ran the <beep>, and we think their stock price is way overvalued.

You will say:

We ran the numbers, and we think their stock price is way overvalued.

We’ll play an example answer after each exercise. Are you ready? Let’s begin.

Cue 1: That’s way too <beep> for my blood.

Learner 1:

Cue 2: We’ve reached an <beep> because we can’t agree on price.

Learner 2:

Cue 3: There’s no two <beep> about it – we’re just going to have to accept the

deal.

Learner 3:

Cue 4: At this point, our need for cash <beep> the risk of taking out a loan.

Learner 4:

Cue 5: We should <beep> in the price of oil in our business plan.

Learner 5:

Cue 6: High <beep> in the market makes it risky to put a value on a company.

Learner 6:

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Successful Negotiations

Answer 1: That’s way too rich for my blood.

Answer 2: We’ve reached an impasse because we can’t agree on price.

Answer 3: There’s no two ways about it – we’re just going to have to accept

the deal.

Answer 4: At this point, our need for cash outweighs the risk of taking out a loan.

Answer 5: We should factor in the price of oil in our business plan.

Answer 6: High volatility in the market can makes it risky to put a value on a

company.

That’s all for this episode. We’ve looked at making and declining a final offer;

expressing dissatisfaction and regret; and leaving the possibility open for further

cooperation by maintaining goodwill. We’ve focused on building good

relationships even when things don’t go according to plan.

Thanks for listening. See you next time.

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Language Review

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