2 men talk over documents on a desk

Tips on negotiating disputes

How you handle a business dispute has a huge bearing on the outcome

2 men talk over documents on a desk

When you are in dispute with your landlord or another business, think carefully about what you really want, try to think about the problem from the other party’s perspective, and always stay focused on coming up with a solution that both of you can accept. These tips will help.

  • Have in mind what is important to you; what would you like to achieve? It can be helpful to think about:
    1. The things you must have
    2. The things that are important (but not must haves) 
    3. The things that you would like (but may not be important)

These things might be different to what you might be entitled to or what rights you might have. Think about what you need for now and into the future, regardless of what might have happened in the past.

  • Review any relevant information and documents to understand what you might have already agreed to and what the other party may think you have agreed to. For example, these may include:
    1. Leases, disclosure statements, photos or written records of discussions with other parties
    2. Invoices or contracts, quotes, warranties, product or service details
    3. Information that explains why work needs to be done, or what items need to be fixed
  • Try to talk to the other party at the earliest opportunity to try to limit the impact on you and your business.
  • When speaking with the other party, make sure you understand the level of authority they have. It is usually best to speak to someone who has the authority to resolve the issue.
  • It can sometimes be helpful to write to the other party but be careful about being misinterpreted and making negotiations more difficult.
  • Use neutral and non-judgemental language. Consider how the other party might respond to what you are saying and how you are saying it. For example, instead of saying “That’s not workable”, try “I’m not comfortable with that because...”.
  • If speaking directly with the other party, the kinds of behaviour that can assist negotiation are:
    1. Understanding their interests and how they compare with your own – what is the reason behind the request or position?
    2. Showing that you are listening to the other party
    3. Actively considering the other party’s views and suggestions
    4. Remaining calm and taking some time away from the discussion if you are feeling emotional
    5. Giving consideration to both long-term outcomes as well as any immediate benefits
  • The kinds of behaviour that can make negotiation difficult are:
    1. Knee-jerk reactions
    2. Emotive outbursts
    3. Negative comments about the other party or assigning blame
    4. Closed body-language (crossed arms, for example)
    5. Focusing only on immediate gains
  • Be clear and concise about the concerns you have (e.g., “I have not received the delivery when I was expecting it”; “I think the electrical fault was at the premises before I started”). Ask questions if you do not understand something.
  • Consider using a neutral third-party to help with a structured negotiation. The NSW Small Business Commission offers a low-cost, efficient mediation service that can help to resolve disputes and preserve business relationships.
  • Consider the advantages of ending the dispute quickly – what is the value to you of a faster settlement?
  • Be prepared to be flexible and collaborate on solutions that you might not have previously thought of.
  • Suggest possible solutions to the dispute. Consider what else you could offer in exchange for something that you want.
  • Think about the cost to you of not reaching an agreement. This can include time away from your business, stress, potential legal fees and the uncertainty of going to court.
  • Consider the importance of any ongoing relationship you may have and may wish to maintain with the other party (e.g. “We have been in business together for many years”; “I have been a long-standing client”; “They have been reliable tenants / landlords”). Listen carefully to what they say and try to put yourself in their shoes and see their perspective.
  • Consider an outcome that might not be ideal but which you are prepared to live with. If you are offered something you have not previously considered, ask for some time to consider the offer if you need it - suggest a later date/time to meet or discuss the issue again. 
  • Consider seeking professional advice from an accountant, financial counsellor, lawyer or business adviser. Friends and family are likely to offer advice that is more personal and emotionally supportive but may not help you to reach a commercial outcome that is best for your business.

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