Ask experienced negotiators what gives them confidence at the table and many will give the same answer: a strong BATNA. The term, which stands for "Best Alternative To a Negotiated Agreement", was popularised by the Harvard researchers Roger Fisher and William Ury in their famous book Getting to Yes.
Your BATNA is simply what you will do if the current negotiation fails. Imagine you are selling your car. A dealer offers you $8,000, but you already have a written offer of $8,500 from a private buyer. That second offer is your BATNA. It tells you that you should not accept anything below $8,500 from the dealer, and it allows you to walk away calmly if they refuse to improve their price.
The stronger your alternative, the more power you have. This is why good negotiators spend a lot of time before a meeting improving their options — contacting other suppliers, getting competing quotes or exploring different solutions. Many people make the mistake of focusing only on the deal in front of them, which makes them feel that they must agree at almost any price.
It is equally important to think about the other side's BATNA. If your supplier has very few other customers, they may need the deal more than you do. Understanding their position helps you predict how far they are likely to move.
Finally, experts warn against revealing a weak BATNA. If the other side discovers that you have no real alternatives, they will have little reason to offer concessions. On the other hand, mentioning a strong alternative — politely and without sounding threatening — can be a very effective way to move a negotiation forward.