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Market Outlook
(continued)

Think of Ways to
Avoid an Impasse

Occasionally negotiations breakdown without any good reason.

You and your advisor did everything right and you still find yourself at an impasse during the transaction. What do you do?

From what I've seen, many breakdowns result on either side from simple things like personality differences, troubles within the organization, fear of loss-of-face, or sheer inability to make a decision. Impasses are not always caused by significant issues or matters of economics.

When considering how to break an impasse, you must take into consideration the human factor. It may not be what you do, but how you do it that becomes the critical factor.

Som of the following moves may be useful in averting a stalemate:

1.	Suggest changes in the specifications or terms.
2.	If the impasse involves money, offer to change the shape of the money. A larger deposit, a shorter pay period, or a different payment stream works wonders. This can be the case even when the total amount of money involved is the same.
3.	Eliminate some of the uncertainty. This can be done by postponing some difficult parts of the agreement for renegotiation at a later time when more information is available.
4.	Change the type of contract. This could include fixed price, scaled price, percentage of increased sales or percentage of profit created.
5.	If it will apply, change the base for calculating percentages. This could include a smaller percentage of a larger base or a larger percentage of a smaller but more predictable base, which could get things back on track.
6.	Create a list of options or alternatives that could be discussed, or change the order of discussion.

Impasse breakers include re-engaging the other party in discussions. These icebreakers help create a climate for new alternatives to be developed. Sometimes the introduction of new alternatives has the effect of making old propositions look better.

Try in advance to pre-plan a face-saving way to reopen discussions should an impasse occur. If you set the stage before an impasse sets in, you are better prepared to handle the problem.

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