Negotiating with Arabs and Iranians

by Dr Jehad Al-Omari (with commentary by Richard Pooley)

Photo by Levi Meir Clancy on Unsplash

During a recent email exchange, Only Connect’s editor, Richard Pooley, and I  discussed the ongoing negotiations between Iran and the United States and whether President Trump could do with some basic facts on negotiating with the Iranians. Both Trump and the Iranian foreign minister, Abbas Araghchi, have written books on negotiating. However, Trump’s ghost-writer, Tony Schwartz, and the publisher of The Art of the Deal, Howard Kaminsky, claim Trump didn’t write a word of it. Araghchi’s book, Negotiations: the Power of Diplomacy was published in Farsi in 2024. This was translated into English last year with the title The Power of Negotiation, a subtle difference which no doubt was noted by the US State Department but not, presumably, by Trump.

Neither of us is an expert on Iranian negotiation techniques but culturally speaking there are many overlaps between Arab and Iranian cultures.

Imagine someone walking into a department store anywhere in the UK and trying to bargain with the person at the payment desk or the sales assistant. Not only is it unimaginable but it would be pointless. However, this is what I did almost four decades ago when I was still fresh from the Middle East. Deep inside me, I knew this was not the norm in the UK but I thought it was worth a try since I was buying three expensive shirts. You can imagine the look on the sales assistant’s face.

I spent almost a quarter of a century in the UK, much of it as a management trainer and consultant. In all that time I can only recall having to negotiate my fees three or four times

One of them was with Richard which was so quick that it really finished before it started.

Richard Pooley: I don’t recall but I’m sure it was quick. This was the 1980s My London-based training company was looking for people with experience of working in key business cultures around the world to run our newly-launched cross-cultural and international negotiation courses. We had some in-house expertise on the Arab World but often it was not deep or wide enough. Jehad was just what we needed. So, why was there hardly any negotiation over his fee? Because our clients had got used to paying the price for our courses run by in-house trainers, who cost us much less than employing a free-lancer like Jehad. If Jehad had tried pushing his fee up, which I’m sure he did, I would have told him that it would have made our course unprofitable. Fortunately for us and our clients he accepted this argument.

Many years after landing in the UK and perhaps having become indoctrinated by its way of doing things, I went back to Abu Dhabi for a holiday. I needed to buy some gifts for friends and colleagues at work. My sister suggested that for the women, I looked into the new types of oriental scarves which could also double as beach-wear. Off I went with my mother to the old Souk. After browsing in several shops we stopped at a stall. The negotiations started, led by my mother.  “How much is one scarf?” She moved on to “What if we buy 3 of them?”, which yielded a discounted price, until we reached ten pieces at a 75% discount per scarf,  and still my mother was pushing for a further discount, with the salesman pleading that he would be losing money, and me intervening because I felt sorry for him. I cut the deal with him as my mother looked at me with disdain. After we left, she told me she could have got a better deal.

Today you would never think of bargaining in department stores in the Arab world. But this is not the case in the wider business world where the art of negotiating is a way of life. It’s also not the case lower down the retail chain.

Starting with my butcher:  if I was buying 2 or 3 kilograms of lamb meat, I would not even bother to negotiate with him as the prices are simply fixed. However, if I was buying, say, a whole lamb, that would be a game changer. I would definitely negotiate and he would expect me to.

Last year, I was traveling from Amman, capital of Jordan, to my home city of Irbid in the north. Along the way, we stopped at a fruit stall near the ancient city of Jerash. I was looking to buy about 5 kilos of figs to eat and to make fig jam. The salesman was so skilled in his negotiating skills and it was such fun doing business with him that I ended up buying 10 kilos of figs, apricots, peaches, prunes, nectarines, grapes and other seasonal fruits; far more than I could really consume but at such bargain prices, particularly since it was all organically produced.  I ended up sending many of them as gifts to my neighbours in Amman.

RP: Jehad mentions the “fun of doing business with” the fruit seller. This is key to understanding why the Arabs (and Iranians?) are such good and tough negotiators. They love negotiating. It’s fun. We Brits do too, especially when abroad in places like Morocco and Turkey (or Jordan!) but it’s not the norm in our society. So, we’re not very good at it. I was lucky, I spent much of my childhood and early adulthood in South America, the Arabian Gulf (or is it now Persian again?), and eastern and southern Africa. I can remember as a teenager sitting with the curio sellers of Zambia in Lusaka and the Victoria Falls as they dealt with Western tourists. These salesmen were master negotiators. They were very happy when the crazy white people accepted their vastly inflated “best prices”. But, as they confided in me, they were just as happy when they had to haggle, even if they got less money. It was a Zambian who taught me the importance of never accepting the other side’s first offer:

“If he says Yes to my first price, I feel bad. Maybe he would have paid me more. If he wants another thing, I will make an even higher price.”

The British do negotiate, of course, in business. However, there are subtle but important differences with the Arab world. Firstly, the typical Brit walks into the real world of business with very little experience in negotiating whereas the Arab or Iranian is practically immersed in it, having seen their mum or dad do it and learning to mimic them from a young age. Secondly, the Arab or Iranian do not only enjoy it but expect it as a way of life and a sign of their business acumen, whereas the British take a longer time to acquire the taste or the flair for it. I was shocked a few years ago when my company were doing business with a leading international British consultancy in Data Migration. They refused to budge on a change to the contract condition. In the end we decided to stop working in this field, to our loss and theirs.

I work in the Information Technology field in the Arab World. Many of our suppliers and clients are Western or Chinese. On the whole, the Chinese are more willing and eager to negotiate than Western companies. This has its pros and cons for us. As suppliers, it is easier and more common to cut win-win deals with the Chinese than with Western companies. On the other hand, it is more lucrative to work with Western companies as clients since they tend not to bargain. More importantly, they do not demand changes in the pricing structure once the contract is signed and sealed. Or rather it was very rare for them to do so until the US-Israel War with Iran made them invoke the force majeure clause in their contracts.

Ah yes, Iran. In the light of the current hostilities, I was shocked to learn recently that there are approximately four to six hundred thousand Iranians living in the UAE, where I grew up. I knew that the Iranians were part of the social and commercial fabric of the Gulf region but the number still surprised me. What this means in practical terms is that while I was growing up in the UAE, the trading culture of the Souk was a mixture of Arab-Iranian-Indian. More often than not, the customers were predominantly Arab but also Indians, Iranians and Westerners. Many of the salespeople where either Indians, Iranians or sometimes Baluchis and many of the businesses where owned by Arabs or Iranians or Indians.  I have often found that the Iranians are the toughest negotiators of all as they drive a hard bargain not on the basis of Win-Win but Small Win (for you)-Big Win (for me).

RP: I once ran some Negotiation Skills courses with Jehad in Abu Dhabi. It was clear from the start that the participants – mostly Emiratis but also Jordanian and Palestinian expats – were not expecting to learn anything from me, a Brit, about the basics of negotiating. They were there to learn about how to negotiate with what Jehad calls Westerners – i.e. Europeans and US Americans. I pointed out that whilst “Western” companies like mine tended to teach the ‘Win-Win’ approach to negotiating, this was by no means the approach taken by many, if not most, of my “Western” clients. Scandinavian companies might negotiate with the intention that both sides came out of the process believing they had done well (the Win-Win idea) but a Spanish company, say, might not care much about how the other side felt, especially if it was a one-off deal. People’s approach and aims when negotiating vary according to culture and industry. The participants accepted this, pointing out the many cultural differences in their part of the world. But on two matters re us Westerners they were all agreed:

First, why was our bargaining range so narrow? Jehad’s mother would have asked the same question.

Second, why did US Americans insist that their way of negotiating was the only and best way? This was a question I met all over the world. It was often followed by a question asking if US American and European companies paid people like Jehad and me to teach their employees how to do business in other cultures. My answer was that few of our clients were American and hardly any were British (our home market!). Our cross-cultural clients were largely German, Scandinavian, Swiss, French, Italian and Japanese.

What did I learn in the Souks of Abu Dhabi and since about the Iranian way of doing business? Simply put, the Iranian trader when importing a certain newly-introduced article, say textiles, will begin by selling at the highest possible price that only the relatively well off, the keen, or the novice buyer will pay. Once the trader has recouped their capital and secured their optimum profit, they will begin to negotiate with the seasoned buyer, sometimes at giveaway prices.

RP: My biggest memory of those two-day courses Jehad and I ran in Abu Dhabi was the one where one of the participants was an Emirati businesswoman. She arrived late wearing a niqab; only her eyes were visible. She apologised in flawless English for being late. She had not told her family that she was on the course; they thought she was at her office. She asked everyone to keep her presence secret. All agreed. It was clear she was well known and highly respected in the UAE business community. I soon discovered why. She was one of the best negotiators I have ever trained. Indeed, she was the trainer. She won every role-played negotiation, acknowledging what a huge advantage it was that none of the men she was negotiating with could read her facial language, and teaching them (and me) how best to overcome this handicap (learn to keep control of your own body language; listen more than talk by asking lots of questions, and listen hard to what is really being said behind the mask). Lunch on both days was taken in the hotel dining room with only glass between us and the rooftop swimming pool. The men pretended to ignore the women tourists in bikinis sunbathing a few metres from them. This woman in her niqab laughed at their and my discomfort and told us of what happened when she and her women friends changed into “Western” clothes once airborne on the plane leaving Dubai. She was the best type of international negotiator - a clever and curious cross-cultural chameleon.