Law 15: The Law of the Concession - Never give something without getting something in return.

1 The Art of the Giveaway

1.1 The Archetypal Challenge: The Premature Discount

Let's imagine a salesperson, David, who is in the final stages of a negotiation with a promising prospect. The customer has gone through the evaluation, they like the product, and the deal seems to be on track. Then, the customer says the five words that every salesperson dreads: "Can you do any better?"

David, fearing that the deal might stall over price, immediately jumps to a concession. "You know what," he says, "you've been great to work with. I think I can get my manager to approve a 15% discount for you. Does that work?"

He has just made a classic, amateur mistake. He has given away a valuable concession—a 15% discount—without asking for anything in return. He has unilaterally disarmed.

The customer, seeing that the first request for a discount was so easily granted, immediately loses respect for the initial price. They think, "If he can give me 15% that easily, the price must have been inflated to begin with." Worse, they see the salesperson not as a strategic partner, but as a simple vendor from whom they can extract concessions. Their next logical question is, "That's a good start, but can you do 20%?"

David has found himself in a race to the bottom. He has turned a value-based conversation into a price-based haggle. By giving something for nothing, he has devalued his product, weakened his own negotiating position, and invited the customer to ask for more. This is the archetypal failure of the "free" concession.

1.2 The Guiding Principle: The Law of the Trade

The solution to David's problem is to internalize a simple but profound rule of negotiation: The Law of the Concession - Never give something without getting something in return.

This law states that a negotiation is a two-way street. A concession is a powerful tool, but it should never be a gift. It should always be a trade. You are giving the customer something of value (a lower price, better payment terms, an extra service), and in return, they must give you something of value.

What can the customer give you? * A faster signature: "I might be able to get you a 10% discount, but only if you can get the contract signed by this Friday." * A longer contract term: "I can't do anything about the annual price, but if you're willing to sign a three-year deal instead of a one-year, I can lock in that price for the entire term." * A case study or testimonial: "We are normally very firm on our pricing, but we are looking for a great new logo in your industry. If you were willing to partner with us on a public case study after a successful implementation, I might be able to make an exception on the price." * Access to a higher-level executive: "The price is the price, but if you could get me a 15-minute meeting with your CFO to discuss the broader strategic value, I'd be willing to include our premium support package at no extra cost."

The Law of the Concession transforms a negotiation from an adversarial haggle into a collaborative, value-based discussion. You are no longer a vendor being squeezed on price; you are a partner looking to create a mutually beneficial agreement. By always asking for something in return, you signal that your own offerings are valuable and not to be given away lightly. You maintain your status, protect your margins, and, paradoxically, increase the customer's respect for you and your solution.

1.3 Your Roadmap to Mastery: From Haggler to Negotiator

By mastering this law, you will learn to navigate the difficult, end-of-deal pricing conversation with confidence and skill. You will learn how to protect your own value while still making the customer feel like they have won. This chapter will guide you to:

• Understand: You will learn the psychology of reciprocity and why a "trade" feels fair while a "gift" feels weak.
• Analyze: You will be equipped with a framework for identifying your own "gives" and "gets"—the valuable assets you can offer and the valuable assets you can ask for in a negotiation.
• Apply: You will learn a set of specific, "If... then..." phrases that will allow you to turn any request for a concession into a productive, two-way negotiation.

This journey will equip you with the tools to stop being a victim of discounting and start being an architect of value-based agreements.

2 The Give-and-Take Dance

2.1 Answering the Opening: The "If... Then..." Reframe

Let's rewind David's negotiation. The customer asks the dreaded question: "Can you do any better on the price?"

The amateur David gave away a 15% discount for nothing. The professional David, armed with The Law of the Concession, hears this not as a threat, but as an opportunity. He uses a simple but powerful "If... then..." construction to reframe the conversation.

"That's a fair question," he says calmly. "The price we've quoted is for our standard package and a one-year term. I don't have a lot of flexibility on the price itself, as we want to be fair to all our customers. However..."

This "however" is the pivot.

"If you were in a position to sign the contract by the end of this week, then I might be able to get my VP of Finance to approve a 10% 'fast-decision' discount. Is that something that would be possible for you?"

This is a masterclass in negotiation. 1. He protected the value of his product. He didn't immediately agree the price was too high. He framed it as the "standard" price. 2. He did not give a unilateral concession. He made his offer conditional. The discount is only available in exchange for something he values: a faster signature. 3. He made the customer a partner. He is not just giving a discount; he is offering a trade. He is inviting the customer to work with him to find a mutually beneficial outcome. 4. He maintained control. The onus is now on the customer. He has asked them a question. He is not a supplicant waiting for a response; he is a negotiator waiting for a counter-move.

The conversation has been completely reframed. It is no longer a one-way street of the customer asking for discounts. It is a two-way exploration of what each party can do for the other. Even if the customer cannot sign by Friday, the principle has been established: nothing is given for free.

2.2 Cross-Domain Scan: Three Quick-Look Exemplars

The principle of "give-to-get" is the foundation of all successful negotiations, from the local marketplace to the global stage.

• Exemplar 1: The Union Negotiation. When a labor union negotiates with company management, they never make a unilateral concession. If the union agrees to give up a work rule that management wants to eliminate (a "give"), they will immediately ask for something in return, such as a larger pay increase or better benefits (a "get"). The entire process is a carefully choreographed dance of "if... then..." proposals.

• Exemplar 2: The Diplomatic Summit. In international diplomacy, the principle of reciprocity is paramount. If one country agrees to lower its tariffs on another country's goods (a "give"), it is with the explicit understanding that the other country will offer a comparable concession in return (a "get"). A nation that makes unilateral concessions is seen as weak and is quickly taken advantage of.

• Exemplar 3: The Parental Bargain. A savvy parent is a master of this law. When a child asks, "Can I have more screen time?" (a request for a concession), the amateur parent says "no," leading to a power struggle. The savvy parent says, "If you finish all of your homework, then you can have an extra 30 minutes of screen time." The parent has turned a potential conflict into a productive, value-for-value trade.

2.3 Posing the Core Question: Why Does a "Free Gift" Feel Cheap?

We see that in every form of human negotiation, the principle of reciprocity reigns supreme. A unilateral concession is a signal of weakness, while a two-way trade is a signal of strength and fairness. This leads to a fundamental question: Why? What is it about receiving something for nothing that can actually lower its perceived value? Why is a concession that is "earned" through a trade more satisfying than one that is simply given away? To master this law, we must first understand the deep-seated psychology of fairness and the economics of perceived value.

3 Theoretical Foundations of the Core Principle

3.1 Deconstructing the Trade: The Psychology of Fairness

Our brains are exquisitely tuned to the concepts of fairness and reciprocity. A one-way concession violates these deep-seated expectations and triggers a series of predictable psychological responses.

1. The Rule of Reciprocity: As we explored in Law 4, this is the powerful social rule that says we should try to repay, in kind, what another person has provided us. The Law of the Concession is a direct application of this rule in a negotiation context. When a salesperson makes a unilateral concession, they are giving a gift with no opportunity for repayment. This can create a sense of discomfort for the customer and, more importantly, it sets a precedent that the salesperson is a "giver" and the customer is a "taker."

By reframing the concession as a trade ("If you do X, then I can do Y"), the salesperson is invoking the rule of reciprocity in a healthy way. They are establishing a social contract that says, "We are partners who help each other." This feels fair and balanced, and it allows the customer to "pay" for the concession with a non-monetary currency (a faster signature, a longer contract), which preserves their sense of fairness and their respect for the salesperson.

2. The Contrast Principle: This is another of Cialdini's principles of influence. It states that our perception of something is heavily influenced by what we have just been exposed to. If you lift a light object first and then a heavy object, the heavy object will feel even heavier. A unilateral concession is a disastrous application of the contrast principle. * When a salesperson easily gives a 15% discount, they have made that "free gift" the new baseline. By contrast, any future, smaller concession will seem insignificant. * More importantly, the initial, higher price is made to look artificially inflated by the contrast with the easily-won lower price.

The "If... then..." trade avoids this trap. The initial price is never conceded; it is held up as the "standard" price. The discounted price is positioned as an exceptional price that can only be unlocked through a specific action. The contrast is not between a "fake" high price and a "real" low price. The contrast is between the "standard deal" and the "special deal" that they can earn. This frames the discount not as a correction, but as a reward.

3.2 The River of Thought: The Economics of Effort

The value we place on something is not just based on its intrinsic qualities, but also on the effort we expended to acquire it.

• Effort Justification (Cognitive Dissonance): This is a well-documented cognitive bias, first explored by Leon Festinger. It is our tendency to attribute a greater value to an outcome that we had to put more effort into achieving. We do this to resolve the cognitive dissonance between the effort we put in and the reward we got. If we worked hard for something, our brain needs to believe it was worth it, so we increase our valuation of the reward.

• The "IKEA Effect" (Dan Ariely, Michael Norton, Daniel Mochon): This is a modern manifestation of effort justification. Researchers have shown that people place a significantly higher value on furniture they have assembled themselves compared to identical, pre-assembled furniture. The effort of the labor increases the perceived value of the outcome.

The Law of the Concession leverages this principle. A discount that is simply given away is like pre-assembled furniture—it has a lower perceived value. A discount that has to be "earned" by the customer (e.g., by agreeing to a faster signature or a case study) is like the furniture they built themselves. They had to put in a small amount of "effort" (the concession they gave you) to get it. Because of this effort, they will subconsciously place a higher value on the discount they received and, by extension, on the product itself. They will be more committed to the deal because they feel like they "earned" it, rather than just being given it.

3.3 Connecting Wisdom: A Dialogue with Negotiation Theory

The Law of the Concession is a cornerstone of modern, principled negotiation theory.

• "Getting to Yes" (Roger Fisher & William Ury): In their groundbreaking book, Fisher and Ury lay out the principles of "principled negotiation." One of the core tenets is to focus on interests, not positions.

  • A customer who says, "I need a 20% discount," is stating a position.
  • The amateur salesperson negotiates on the position, which leads to a haggle.
  • The professional salesperson uses the request for a concession as an opportunity to uncover the underlying interest. They might ask, "Help me understand, what is the business reason that the 20% number is so important?"
  • Perhaps the customer's interest is not the discount itself, but a need to show their boss that they "got a good deal." Or perhaps their interest is a legitimate cash-flow problem.

• The "If... Then..." Trade as Interest-Based Negotiation: Once you understand the underlying interest, you can use the "If... then..." framework to propose creative trades that satisfy both parties' interests.

  • If their interest is "looking good to the boss," you can say, "If you can get this signed this quarter, then I can frame this as a 'strategic partnership discount,' which will look great on your internal business case."
  • If their interest is cash flow, you can say, "If you can sign the three-year contract, then I can offer you quarterly payments instead of annual-upfront."

This approach moves the conversation away from a zero-sum battle over a single number (price) and towards a collaborative, problem-solving discussion about how to meet both parties' underlying interests. This is the essence of transforming a haggle into a negotiation.

4 Analytical Framework & Mechanisms

4.1 The Cognitive Lens: The Give-Get Matrix

To apply this law systematically, you must enter every negotiation prepared. You need a clear inventory of the valuable assets you have to "give" and the valuable assets you would like to "get" in return. The Give-Get Matrix is a simple tool for creating this inventory. Before any negotiation, take a few minutes to fill out this matrix.

The Four Quadrants of the Matrix:

Using the Matrix:

• Brainstorm Your "Gives": What can you offer? Think beyond price. (e.g., flexible payment terms, premium support, a dedicated account manager, extra training, access to an executive, a seat on your customer advisory board).
• Brainstorm Your "Gets": What do you want from the customer? Think beyond the signature. (e.g., a multi-year contract, a case study, a video testimonial, an introduction to another division, an agreement to be a reference, payment upfront, faster signature).
• Identify the "Easy Win-Wins" (Quadrant 1): This is the sweet spot. What are the things that are low-cost for you to give but high-value for them to receive, and vice-versa? This is the most fertile ground for creative, value-based trading.
• Prepare for Their "Ask" (Quadrant 3): The customer is most likely going to ask you for something that is hard for you to give (a discount). Your job is to be prepared to immediately counter by asking for something that is easy for them to give (a faster signature, a testimonial).
• Know Your "Walk-Away" Point: The Quadrant 4 items are often where deals fall apart. It's critical to know your limits. What is the concession that is so hard for you to give that you would rather walk away from the deal?

By preparing this matrix beforehand, you transform yourself from a reactive haggler into a proactive, strategic negotiator.

4.2 The Power Engine: Deep Dive into Mechanisms

The Give-Get Matrix is effective because it leverages two key psychological mechanisms: proactive framing and the preservation of status.

• Cognitive Mechanism: Proactive Framing & Anchoring. By preparing your "gives" and "gets" in advance, you are preparing to frame the negotiation on your own terms. When the customer asks for a discount, you are not surprised. You have a pre-planned response. You can immediately re-frame their request for a price concession into a discussion about a value-based trade. This allows you to "anchor" the negotiation around the idea of mutual exchange, rather than letting the customer anchor it around the idea of unilateral discounting. You are setting the rules of the game.

• Social Mechanism: The Preservation of Status. A negotiation is a delicate dance of status. When a salesperson gives a unilateral concession, they are lowering their own status. They are behaving like a low-status vendor who is desperate for the business. This invites the customer to take on a higher-status role and demand more. The "If... then..." trade preserves the salesperson's status. It frames the interaction as a peer-to-peer conversation between two equal parties who both have valuable assets to trade. This preservation of status is critical for maintaining a healthy, long-term partnership and for preventing the relationship from devolving into a simple commodity transaction. You are signaling that you are a partner to be collaborated with, not a vendor to be squeezed.

4.3 Visualizing the Idea: The Negotiation Scale

To visualize this law, imagine a classic two-pan balance scale. This scale represents the value of the deal.

• The Unilateral Concession (The Tipping Scale): When the customer asks for a discount, and the salesperson simply gives it to them, they are taking value out of their own pan and placing it in the customer's. The scale becomes unbalanced. The deal is now tipped in the customer's favor. The salesperson has lost leverage and status.

• The "If... Then..." Trade (The Balanced Scale): The master negotiator understands that the scale must remain balanced. When the customer asks for a concession (e.g., a 10% discount), they are asking the salesperson to take a weight out of their pan. The salesperson must immediately ask for a weight of equal value to be placed back in.

  • "If I take this 10% discount out of my pan..."
  • "...then you must place the 'three-year contract' weight into my pan to keep the scale balanced."

The goal is to always keep the scale in equilibrium. Any "give" must be met with a corresponding "get." This ensures a fair, balanced, and sustainable agreement for both parties. Your job as a negotiator is not to "win" by having the heavier pan; it is to be a master of keeping the scales perfectly balanced.

5 Exemplar Studies: Depth & Breadth

5.1 Forensic Analysis: The Flagship Exemplar Study of the "Ben Franklin Close"

One of the most timeless and effective negotiation tactics is the "Ben Franklin Close." It is a beautiful and simple execution of The Law of the Concession, designed to transform a price-based haggle into a collaborative, value-based discussion. The apocryphal story goes that when faced with a difficult decision, Ben Franklin would take out a piece of paper, draw a line down the middle, and list all the "pros" on one side and all the "cons" on the other. In a sales context, this becomes a powerful negotiation tool.

Background & The Challenge: A salesperson is in a negotiation, and the customer is fixated on the price. They are asking for a significant discount, and the conversation has stalled. The salesperson needs a way to shift the focus from the "con" of the price to the "pros" of the value their solution provides, and to do so in a collaborative way.

The "Law of the Concession" Application & Key Decisions: The Ben Franklin Close is a structured way of executing an "If... then..." trade, where the "get" is the customer's own verbal affirmation of the product's value.

1. Acknowledge and Validate: The salesperson does not argue about the price. They acknowledge the customer's concern. "I understand. It's a significant investment, and you have to be sure it's worth it."

2. The Pivot and the "Trade" Proposal: The salesperson then pivots to the Ben Franklin exercise. "You know, when I have a tough decision to make, I do what Ben Franklin used to do. Let's do a quick 'pros and cons' list together, just to make sure we're looking at the whole picture. Is that fair?" This is a low-pressure, collaborative ask.

3. Co-Create the "Value" List (The "Pros"): The salesperson then leads the customer through a review of all the value they have already agreed upon in the sales process. "So, on the 'pros' side, we agreed that the solution would solve your data entry problem, which is costing you about 10 hours a week. Is that right?" "And we agreed it would reduce your compliance risk..." "And we agreed it would give you better visibility into your pipeline..." The salesperson is getting the customer to re-state and re-commit to the value, out loud.

4. Isolate the Price (The "Con"): After building a long list of "pros," the salesperson then addresses the "con." "Okay, that's a pretty strong list of pros. Now, on the 'cons' side, it seems like the only thing holding us back is the $20,000 price tag. Is there anything else?"

5. The Final "Weighing": The salesperson then puts the two sides of the list in contrast. "So, it seems to me we have this long list of compelling, valuable 'pros' on one side, and the single 'con' of the price on the other. In your opinion, do these pros outweigh this one con?"

Implementation & Details: This is not about literally drawing a line on a piece of paper (though it can be). It's about the conversational structure. The salesperson is making a trade. The implicit "If... then..." statement is: "If you want me to reconsider the price, then you must first work with me to reconsider the value." The "get" for the salesperson is a powerful one: they get the customer to argue on behalf of the solution and to re-sell themselves on the value before the price is even discussed further.

Results & Impact: This technique is incredibly effective at reframing a negotiation. It shifts the customer's focus from what the solution costs to what it is worth. By the end of the exercise, the price often seems much smaller in comparison to the long list of agreed-upon benefits. It is a masterful way to protect your price, reinforce your value, and turn an adversarial haggle into a collaborative exercise in problem-solving.

Key Success Factors: * Collaboration: It is framed as a joint exercise, not a lecture. * Value Reinforcement: It forces the customer to recall and reaffirm all the value propositions they have already agreed to. * The Power of Contrast: It starkly contrasts the long list of benefits with the single issue of price.

5.2 Multiple Perspectives: The Comparative Exemplar Matrix

These examples illustrate that the principle of a balanced trade is a universal feature of successful human interaction. Whether you are selling software, perfume, or a technical project, the rule holds: never give something of value without getting something of value in return. The art lies in creatively defining what "value" means for both parties.

6 Practical Guidance & Future Outlook

6.1 The Practitioner's Toolkit: Checklists & Processes

To master the art of the trade, you must be prepared, disciplined, and creative. These tools will help you build those muscles.

Tool 1: The "Give-Get" Negotiation Planner

Never enter a negotiation without a plan. Use this simple planner, based on the Give-Get Matrix, before any call where you anticipate a discussion of price or terms.

• My Top 3 "Gives" (Easy to Hard):

  1. Easy Give: (e.g., A free, 2-hour training session for their team)
  2. Medium Give: (e.g., Net-60 payment terms instead of Net-30)
  3. Hard Give: (e.g., A 10% discount on the first year's subscription)

• My Top 3 "Gets" (Easy to Hard):

  1. Easy Get: (e.g., A written testimonial for our website upon success)
  2. Medium Get: (e.g., A co-hosted webinar or case study)
  3. Hard Get: (e.g., A three-year contract instead of a one-year)

• My "If... Then..." Opening Moves:

  • "If you ask for better terms, then I will ask for a longer contract."
  • "If you ask for a discount, then I will ask for a faster signature."
  • "If you ask for free training, then I will ask for a public testimonial."

• My "Walk-Away" Line:

  • I will not go below a ____% discount.
  • I will not agree to _ without getting _ in return.

Tool 2: The "Bracketing" Technique

When a customer asks for a concession, it is often a mistake to grant it in full, even as a trade. A more advanced technique is to "bracket" their request—to offer something less than what they asked for, but still of value.

• Customer: "Can you give me a 20% discount?"
• Amateur: "Yes, I can do 20% if you sign this week." (Gives them everything they wanted).
• Professional: "A 20% discount is just not possible, as our margins are already tight. What I can do is go to my manager and see if I can get approval for a 7.5% discount if you can sign this week. Would that be helpful?"

This technique is powerful for three reasons. First, it makes the concession you are offering seem more valuable, because it was difficult to get. Second, it signals that you have reached your limit, which makes them less likely to ask for more. Third, it preserves your margin more effectively.

6.2 Roadblocks Ahead: Risks & Mitigation

The path of the negotiator is fraught with the temptation to take the easy way out.

• Risk 1: Negotiating with the Wrong Person. A salesperson spends hours in a back-and-forth negotiation with a low-level manager who does not have the authority to make the concessions the salesperson is asking for (e.g., a longer contract term).

  • Mitigation: Qualify your negotiating partner just as you qualify your deal. It is perfectly acceptable to ask, "Are you the right person to discuss a multi-year agreement with, or would that be someone else?" before you start trading concessions. Never trade a "hard give" (like a discount) for a "get" that your counterpart has no authority to grant.

• Risk 2: The "Split the Difference" Trap. In a negotiation, it is a common and lazy tactic to simply "split the difference." You want $100, they offer $80, so you agree to $90. The problem is that this encourages extreme opening positions. A savvy customer will learn to always ask for a huge, unreasonable discount, knowing you will likely meet them in the middle.

  • Mitigation: Never split the difference based on the positions. Always tie your concessions to objective criteria and value. If you are going to move your price, it shouldn't be to a random midpoint. It should be in exchange for a specific, valuable "get" from your Give-Get list.

• Risk 3: Giving Away Your BATNA. A salesperson, in an effort to be transparent, reveals their "walk-away" point too early. "My manager will never let me go below a 10% discount."

  • Mitigation: Your "Best Alternative to a Negotiated Agreement" is a source of power (Law 13). You should know it, but never reveal it. The moment you tell the customer your limit, you can be sure their next offer will be exactly that limit. Maintain a "poker face" regarding your own internal constraints.

6.3 The Future Compass: Trends & Evolution

In a world of transparent pricing and automated procurement, the art of the value-based trade will become more important, not less.

• The End of Information Asymmetry: In the past, salespeople had a significant advantage because they knew what the "real" price was and the customer did not. Today, with online reviews and pricing comparison sites, that asymmetry is gone. Customers are often highly informed about your pricing and your competitors'. This makes unilateral discounting even more dangerous, as it signals that your publicly listed price is not your real price. The only way to defend your value is to be a master of the value-based trade.

• The Rise of the "Procurement Bot": In the future, much of the initial negotiation may be handled by AI-powered "procurement bots" on the customer side. These bots will be programmed to ask for the maximum possible discount. A salesperson who only knows how to give unilateral concessions will be destroyed by these algorithms. The successful salesperson of the future will be the one who can creatively and collaboratively trade non-monetary "gives" and "gets" that the bot is not programmed to understand, thus forcing an escalation to a human decision-maker who can appreciate the nuances of a true partnership.

6.4 Echoes of the Mind: Chapter Summary & Deep Inquiry

Chapter Summary:

• Giving a unilateral concession devalues your product, weakens your negotiating position, and invites the customer to ask for more.
• The Law of the Concession dictates that you must never give something without getting something of value in return.
• The power of this law is rooted in the psychology of reciprocity, the contrast principle, and effort justification. A discount that is earned feels more valuable than one that is given.
• The Give-Get Matrix is a tool for preparing for a negotiation by inventorying your valuable assets and planning your trades.
• A negotiation should be a collaborative search for a balanced, mutually beneficial agreement, not an adversarial haggle. Your goal is to keep the "negotiation scale" balanced.
• Practitioners must be wary of negotiating with the wrong person, the lazy "split the difference" trap, and revealing their walk-away point.

Deep Inquiry & Discussion Questions:

1. What are three non-monetary "gives" you could offer in a negotiation that would be of high value to your customers but low cost to your company?
2. What are three non-monetary "gets" you could ask for from a customer that would be of high value to your company?
3. Think of the last time you gave a discount. Did you get anything of equal value in return, or was it a unilateral concession?
4. Role-play a scenario where a customer says, "Your competitor is 20% cheaper." Instead of defending your price, use the Law of the Concession to reframe the conversation.
5. Debate the statement: "In a true commodity market where there is no product differentiation, this law does not apply." Is this true? Or are there always non-monetary things to trade?