Counterparty Needs to Have Authority
I have bought and sold quite a few domain names to larger companies with multiple levels of decision makers. In these dealings, I have negotiated with a variety of individuals at different positions within the companies. One thing that should be discussed is whether the other party has the authority to negotiate terms and agree to a deal.
I have discussed deals with everyone from marketing managers to lawyers to executives. Generally speaking, I assume that the other party is authorized to discuss a deal because they either contacted me to discuss a domain name or they were the point of contact for me. As a negotiation gets going a bit, you should think about asking the other party if they have the authority to do a deal with you.
The primary reason for learning this information is that you don’t want to reach a deal with the other party only to learn that someone else has the power to cancel the deal. It can be a major time waste if you negotiate a price and terms only to learn that there are other people that need to get involved before the deal can be finalized. It is pretty crappy to reach a deal after an extended negotiation, only to learn that the deal isn’t really done yet. It is also annoying to get a price for a domain name, agree to buy it, and learn that the deal needs to be approved by someone else before moving forward.
A secondary but important reason to establish that the other party has authority is that you can prevent the other party from coming to terms with you and then stating that they need to take the decision to someone else or to the “board.” This can be a negotiating tactic to get a better price (ie: good cop / bad cop). If you have already established that they have the authority to consummate a deal, you have eliminated the chances of pulling out this tactic at the outset.
I can assume the c-suite executives have the authority, and I would only ask them about it for the second reason I mentioned. It might be good to ask a lower level employee like a marketing manager, SEO manager, or webmaster.
I can’t give great advice on how to ask if your counterparty has authority without possibly belittling them. I would probably say the best way to approach it is to ask something like, “if we can agree on terms, do you have the authority to move forward with the deal or will other parties need to approve it?” There are probably more tactful ways to ask though.
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