How to Make a Sound Offer Every Time

Negotiation is something many people dread, but believe it or not, it can be pretty simple. I have a formula for making an offer, and once you learn it, you can put it to work in a host of situations.

Let’s say it’s springtime and your house could use some window washing after a wet winter. So you call the first company listed online and they come over and give you a quote. Most people would just accept the estimate or, at most, call up a few other companies and pick the one with the lowest price. Assuming the bidders all are equally competent, why not start with the lowest price and negotiate for a better one?

All you have to do is make the following calculation: What supplies are needed at what cost? How many workers and hours are required to do the job? Factor in wages for the workers, a decent sum for the company’s overhead, and a fair profit for the owner. That’s it—costs, overhead, and profit.