Tips for Entrepreneurs – #7
Shifty dealing may make for good television and movies, but in real life, good deals are good for everybody, and bad deals—in the long run—are often bad for everybody.
There’s nothing wrong with a tough negotiation. At the end of the day, if both parties feel that they are walking away winning something, it will create the opportunity for future deals and future business. Business is not a zero-sum game. Have you heard the expression, “A rising tide lifts all boats”? It’s true in business also—successful relationships beget more success.
A good deal is only good if it is good for everybody.
Featured as Tip number 23 in my book, The Evolution of an Entrepreneur.
From the Jack Nadel Archives
As you may have already read in my latest book, The Evolution of an Entrepreneur, I made a licensing deal with Pierre Cardin in 1979. I needed a glamorous brand name for ballpoint pens that we were manufacturing in France. After we negotiated the license agreement with Cardin, he designed the pens carrying his name. He benefited by gaining a completely new and reliable income stream from a royalty on every pen sold, and we were able to manufacture and advertise a quality, designer-name product. Our distributors had an exciting new pen to sell that marked the first volume entry of a designer brand into the advertising pen business. The deal was good for everybody.
How Does This Tip Apply Today?
Yahoo! was an Internet pioneer, but in 2008, its CEO, Jerry Yang, made what some say was one of the worst business decisions ever. He turned down a 44.6-billion-dollar buyout offer from Microsoft. Yahoo! shareholders have been regretting this ever since. Why did Yang turn down the offer? In part because he believed he could negotiate a slightly better offer than what was on the table. A year later, shares were selling at a third of their former value. Sometimes you can drive a deal right off a cliff.
Tips for Entrepreneurs
This post is part of my regular “Tips for Entrepreneurs” blog post series, featuring shared experiences and wisdom from my career as a global entrepreneur that I outline in an easy to understand tip format with a brief story/snippet from my own business experience, as well as a current anecdote about how this tip applies in today’s business environment. These entrepreneurial tips are also featured in my award-winning book for entrepreneurs, The Evolution of an Entrepreneur, featuring 50 of My Best Tips for Surviving and Thriving in Business.
Referenced for How Does This Tip Apply Today? materials:
Frank Watson, “Yahoo Rejects Microsoft: Worst Decision Ever?,” Search Engine Watch, May 9, 2008, http://searchenginewatch.com/article/2066473/yahoo-rejects-Microsoft-Worst-decision-ever.
Jay Yarow, “Yahoo Is So Cheap Right Now, It’s Basically A Free Takeover Target,” Business Insider, august 9, 2011, http://articles.businessinsider.com/2011-08-09/tech/30019666_1_carol-bartz-yahoo-share.