For many people I know in the domain business, negotiating a deal is almost as exciting as completing a deal. It can be exhilarating to get a buyer or seller to agree to a favorable deal, and when a negotiation takes weeks or months, the thrill of the actual deal may be lost by the time it comes to its conclusion.
Because of the enjoyment many people get from negotiating, it is very possible to lose out on a fair deal trying to get the best terms possible.
In a negotiation, I think it is human nature for the buyer or seller to want to get the absolute best deal possible. Even if a deal is fair for both parties, some people want to “win” the negotiation rather than reach a fair deal that is still good for both parties. In an effort to “win,” they might actually lose out on a deal.
While most negotiations I am involved with take hours or days, there have been a few negotiations that have taken weeks or longer to complete for various reasons. During that time, many changes can happen that impact the buyer or seller and can change the negotiation. A higher offer can be made by someone else, the sale of another domain name or asset can eliminate the need or desire to sell, or something else can become a distraction for the other party. Whatever the case is, trying to get that perfect deal may compromise the ability to get any kind of fair deal.
This week, I have been involved in negotiating a domain deal as the buyer. The price was fair, but in the hopes of getting the “perfect” deal, I rejected a counter offer and tried to get a lower price. I was met with radio silence and thought that I may have lost out on the deal. After thinking about it, I agreed to move forward at the counter offer and we are now in escrow.
It is important to get a fair deal on a domain acquisition. However, if the price is right, I should easily be able to overcome the difference between a fair deal and a perfect deal.
Many domain investors miss out on making a great deal of money simply because they refuse to accept the reality of the true current market values of their names.
If you invested in a domain at a purchase cost of $50,000 and now you believe a few years have passed and now it is worth $1 Million but all the offers you’re getting are in the $100,000 range, (even from end users) than it’s time to wake up and accept that the real value right now is only $100,000 +/-.
Stop being greedy and take your substantial 200% ROI profit and be thrilled with that score. Yes sometimes incredible “win the domainer lottery” million dollar 20x your investment returns happen in domain investing, but very rarely, especially in this market we’re in now.
If the seller is not hard up for cash or is willing to sit on the domain for years on end until a better offer comes along, what motivation does he have to accept the lower $100K offer?
I agree that many sellers get greedy, but many of them can afford to be greedy… Many have full time jobs and live comfortable lifestyles, Domaining is just a side line, an investment like other investments they hope to cash in on BIG some day, and time is of zero importance.
For the kind of domainer, they will always have the upper hand when negotiating price.