Can Business Negotiations Improve Over A Meal?

On May 16, 2013, wrote:

Running a business can be exhausting, especially if you’re about to have a business deal. You want to know everything you can do to lighten the blow and have the dealings be as pleasant as possible for you and the other party. Even then, when you think you have everything figured out, you still might worry about the outcome.

One of these preparations that people commonly consider is dining while doing negotiations. In many cultures, it is an expectation that you will conduct business dealings over a meal. But some people may wonder, particularly in the United States, where it is not necessarily a common practice to negotiate at a restaurant, if business negotiations are really more successful if they take place over a meal. Read on to learn how meals can actually help your business negotiations be more effective.

Great Bonding

In general, meals can be a great bonding experience. One of the most useful things about taking your negotiating meeting to a restaurant is that the business dealings will be taking place in a neutral location. This allows both parties to have even footing and not feel intimidation from one side or the other.

Think about it: if you are walking into another company’s boardroom and are surrounded by their executives, you won’t feel the confidence you’d feel on your own turf, and this could lead to you conceding to their demands if you don’t think you have good footing. This holds true for the other side as well. At a restaurant, both parties are on common ground and won’t feel an advantage or disadvantage over the other side, but food plays a more important role in this than the actual location does.

Better successful negotiations

Another thing to consider is that research actually shows that business dealings conducted over meals are more successful, and that eating is really the only collaborative activity that leads to better negotiations. Lakshmi Balachandra, a professor at Babson College, performed an experiment with 130 business students to see how negotiating over a meal would either help or hurt the outcome of the discussions for either party.

What she found was that the students who dined during their dealings were able to negotiate much higher profits than those who either did not dine or the teams that tried to engage in other team-building activities or tasks like solving a puzzle together. This research has excellent implications for the idea that eating together can help businesses engage in better transactions.

Balachandra’s research also showed that eating in general is the important component of the negotiations; going to a restaurant is not necessarily the best option. Groups in the study who didn’t eat out but instead just had food available in a conference room were able to negotiate profits and positive transactions just as well as those who went to restaurants. So even if you do have to host a negotiation at your office, provide food. This will still result in better cooperation than a plain old boardroom meeting.

It’s all because of biology

All of this is great news for people looking to enhance their business dealings, but what is the explanation behind it? Balachandra found that this phenomenon is essentially a biological one, with some social ties. When people eat, their glucose levels rise and this augments complex brain activities, engages self-control mechanisms, and regulates aggressive behaviors that could emerge without the presence of food.

Additionally, other studies have shown that when people participate in similar behaviors and unconsciously mimic each other’s movements, they are more likely to experience positive thoughts toward each other. This suggests that seeing people eating while you are also eating will subconsciously allow you to identify with them on a deeper level, and you’ll be more apt to respond positively to their suggestions. Negotiations will go much more smoothly if you and the other side are joining in similar actions.

Interestingly enough, eating together can have very positive results when it comes to taking on business negotiations. If you’re preparing to undergo some serious exchanges with another company, consider doing the negotiations in a restaurant, or hiring a caterer to bring food to your office if you’re hosting the other party. If you’re working with foreign clients, be sure to inform yourself about their particular cultural practices as well. Yes, negotiations can be difficult, but enjoying a great meal along with the conversation can lead to improved responses and better outcomes for both sides.

About the Author

The article is written by an entrepreneur, William Taylor. He is working with a site, thegappartnership.com, which is all about negotiation. Even the site provides workshops for negotiation in many languages.


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