Introduction to NegoEconomics

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Transcript

Nega economics is an amazing mathematical model, because partly it's very simple. And secondly, because it actually proved that we have a huge unusual, but potential in most negotiation. negra economics has actually been awarded and several bicycle organizations worldwide for the simple reason, as I just said, we can figure out that as an unused, unused, utilized potential in most negotiation. What you see in this slide right here is an average negotiation and the value of this negotiation could be 10 million is not really important. And it's not important what this negotiation is all about either. What we've seen average is that the buying side the purchase is only leaving this negotiation with an average of 19% of all the value.

So in this case, this negotiation was 10 million, that would be 1.9 million, obviously, the selling side on the other side of the table in average, leaving this negotiation with 39% of the value. In this case, that will be 3.9 million. But the really interesting thing, ladies and gentlemen is that neither of these two parties know how much they gained in percentage of the whole pie. And neither of them actually sees that as an unutilized potential that neither of them actually got. And that is the 42%. So what we know from economics is that up to 42% of the values in a negotiation are basically being lost.

It's left on the table when the buyer and the seller are leaving the room. So neither of them are utilizing, seeing or gaining any of that potential. When we are talking about macroeconomics, it's a simple question, how is an economics generated? Well, very simply a test generated on the basis of differences so that could be different costs different values. So give you a very simple example the cost of money. Now you may have an internal interest rate, I may have a different internal interest rate, and the one of us that got the lowest cost of capital internal interest rates would obviously finance the business.

This deal and the difference between the two interest rate is what we call macroeconomics. So the parties have different needs different interest have different values, different ambitions, it could be terms of time, a lot of other interesting areas, economies of scale, obviously, and basically, through all changes where costs are below the value

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