Always know your BATNA when entering into a negotiation. What is BATNA? BATNA is an acronym that stands for Best Alternative To a Negotiated Agreement. The diagram illustrates each party’s best alternative to a negotiated agreement (seller and buyer):

* ZOPA stands for “Zone Of Potential Agreement.” It is the overlap between the seller’s and buyer’s settlement range.
* Seller’s settlement range is a biddable range acceptable to the seller.
* Buyer’s settlement range is a biddable range acceptable to the buyer.
* Buyer’s/Seller’s worst case is the reservation point of the respective parties.

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