Not everyone is born a deal-maker, Trump warns us. Some people have the instincts, and some don’t. Even if someone has the instincts, they may never get off their couch to try something more ambitious. People are afraid to take chances and that holds them back.
I think we can agree that Trump has been in business for a very long time. He probably knows a thing or two about deals.
Chapter two of The Art of the Deal covers Trump’s approach to deal making.
Trump likes to think big. “If you’re going to think, you may as well think big,” he tells us. He sets large goals and uses visual language to paint a compelling picture. This sets anchors in peoples minds as a starting point for negotiation. By aiming high and pushing towards that goal, repetition will increase the goal’s importance in people’s minds. His own single-minded drive and total focus allow him to work hard on his deals, he tells us.
By covering the downside to a deal, Trump ensures he can’t lose big. If possible, he sets up a win-win situation regardless of his outcome. He asks himself what’s the worst that can happen, and he works to improve that outcome. He tries not to leave himself exposed. Trump gives the example of waiting to build until he has the necessary business licenses for when the construction is complete.
Trump prefers to maximize his options. He doesn’t needlessly close an avenue of negotiation. He keeps multiple options available for his active deals.
He learns a lot by asking the opinion of others before he makes his deals. He wants to be sure he knows all aspects of what he’s getting into. He makes his decisions once he has a gut feeling that he trusts.
Leverage, Trump says, is key. Something the other side wants, or needs, allows you to negotiate from a position of power. We see this today with Trump’s offers to meet with North Korea — that’s a recognition that North Korea desperately wants. That alone can give the US the upper hand.
Location, the real estate developer reminds us, is of course very important. You can enhance your location’s reputation and therefore value — with persuasion and marketing alone.
Promotion and marketing, of course, help spread your message and product. Trump knows the newspapers love a sensational story. We’ve seen Trump’s ability to gain media coverage on a topic of his choosing. Trump uses his lifestyle and his ambitious projects to keep himself interesting and in the press, which is worth far more than a paid advertisement. Attention creates value.
Frame a topic positively, he tells us, and present it with bravado. Get people dreaming your dream and they’re more willing to buy in. This “truthful hyperbole” can be seen with Trump’s common exaggerations. Everything Trump does is the “best” and “most beautiful.” This is no accident.
Fight for what you believe in. If someone is attacking you, fight back hard. Don’t walk away. We’re warned that a fight may make the situation worse or it may alienate others, but that it usually works out for the best.
Deliver your product on time, and within budget. You can’t con people or soon they won’t work with you. Be a good business partner.
And have fun, because life’s too short.