CBB Negotiation Strategies & Deal Closing Flashcards

What is the broker's primary role during negotiations between buyer and seller?

Answer: To facilitate communication and help both parties reach a mutually acceptable agreement

A skilled broker acts as a neutral facilitator, managing emotions and keeping negotiations focused on achieving a successful close.

What negotiation tactic involves presenting multiple deal terms simultaneously to allow the other party to trade off issues?

Answer: Multiple Equivalent Simultaneous Offers (MESOs)

MESOs give both parties flexibility to choose among balanced offer packages, reducing impasse risk and revealing priorities.

What is 'anchoring' in the context of business sale negotiations?

Answer: Setting the initial reference point for negotiations, which influences the range of final agreement

Anchoring is a cognitive bias where the first number introduced in a negotiation disproportionately influences the final outcome.

When a buyer submits a low offer, how should a skilled broker advise the seller to respond?

Answer: Counter-offer at a price closer to the asking price with a reasoned justification

A reasoned counter-offer keeps negotiations alive and signals the seller's seriousness while establishing a higher value anchor.

What is a 'seller's note' (seller financing) and why might it help close a deal?

Answer: A portion of the purchase price funded by the seller as a loan to the buyer, making the deal easier to finance

Seller financing bridges gaps in buyer funding, signals the seller's confidence in the business, and often enables deals that cannot be fully bank-financed.

What does 'BATNA' stand for and why is it important in deal negotiations?

Answer: Best Alternative to a Negotiated Agreement; it defines each party's walk-away position

Knowing your BATNA prevents you from accepting a deal worse than your alternatives and strengthens your negotiating position.