Negotiating Tip - Settlement Escrows

The key to the below negotiating tip is having an impartial third party.

Asking for a little gets you a little, and holding out a lot may get you nothing.

The problem is not with the players, but with the game..University of Chicago Business School professor Rob Gertner and NYU law professor Geoffrey Miller may have come up with a better game to play..They call their negotiation method "settlement escrows"..

Here's how settlement escrows work. The buyer and seller agree to bring in a neutral third player to act as a mediator. The seller tells the mediator, in private, a price at which he'd be willing to sell. Likewise, the buyer lets the mediator know, again in private, a price at which he'd be willing to buy. The mediator checks to see whether the two prices cross- that is, whether the buyer's offer exceeds the seller's bid. If so, the mediator calculates the midpoint price, and seller and buyer transact at that price. If the two prices don't cross, the mediator doesn't reveal either price. Neither side learns't the other's bid, and the two parties can go on negotiating without prejudice..

Settlement escrows allow people to negotiate from behind a veil...You can say what you really need without giving away much information. When the parties in a negotiation feel safe enough to make reasonable demands, they're much more likely to reach an agreement..

From Co-opetition by Adam Brandenburger and Barry Nalebuff