Domain broker, Hobi Michalec, is the co-founder of Lumis, a boutique domain brokerage company.
Along with his business partners, Hobi focuses on premium domain names, and has extensive experience in dealing with corporate acquisition teams.
In a recent exchange, Hobi offered some solid advice on how to best deal with domain offers, maximizing your ROI when negotiating.
Here are some excerpts:
Hobi Michalec – Lumis.
Never make a concession without it being conditional.
An easy general thing to do is to make it time sensitive and say something like, “This is less than I want. If you can fund in the next X number of days we can move forward.”
While people can still backtrack it makes it much more difficult to do so because it makes it very apparent that doing so will almost certainly kill the deal.
It helps to remove back tracking as a “negotiation” tactic.
What about increasing pressure on the potential buyer?
Hobi says:
A word of advice on that is to lengthen the time frame you provide during initial contact and reduce it as you get closer to the finish line.
The issue you could run into is that if they see you provide such an aggressive time-frame out of the gate, it makes it more likely that they’ll ignore future time frames when they are arguably more important.
If your BIN is justified, as in you’re not shooting for the moon and willing to move significantly, don’t counter.
Even if you are a motivated seller, saying something like, “I’m sure we could work something out but not at that level.”
Then leave it at that. The ball’s in their court. Then follow up with them every few weeks months, etc. Whichever time-frame is appropriate.
Lastly, here’s what to do when the buyer first commits on a price, then pulls away from their own offer:
I can definitely understand the frustration. I can’t stand it when someone makes a commitment and then backs out on it, whether it’s buyer or seller.
Whenever I get heated like that, I force myself to walk away, go outside, something, whatever it is, NEVER reply immediately. You’ll almost always choose a less opportune strategy because we’re not level-headed.
Even doing this out of the gate with your initial counter helps to structure the time frame for the overall negotiation. It can give you an idea of this is going to be a few weeks or a few months or even a few years.
Thanks, Hobi! 😀
