In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that
have shaped their business philosophy.



Chairman, Overstock.com


Background:  

In 16 years, Overstock.com has become an industry leader in giving customers “quality products at the best prices possible.” The Salt Lake City-based firm expects to book $2 billion in sales this year and is rapidly expanding its Utah operations. Chairman Jonathan Johnson deployed his marketing skills in an unsuccessful bid for the 2016 GOP nomination for governor of Utah, using the #HireJJ hashtag.

The Mistake:

Relatively early in my career, I was going from a job at one company to another. I had three competing offers for the next job, and I let the base salary weigh too much in the decision. The company I joined turned out not to be a great fit; they were willing to pay more, but had unreasonable expectations, and I ended up leaving them.

I faced a similar story early in my career: I was negotiating a deal where I had all the leverage. The other party was dying to do business with us, so I negotiated hard and won on every point. I thought I had done well, so I went back and talked to my boss about it. He said, “Jonathan, it is a horrible deal. We can’t take it.”

He said, “We’ll make money for a year and they’ll go out of business. Go back and negotiate a fair deal, a win-win deal.”

I negotiated hard and won on every point.

The Lesson:

I’ve taken into account with Overstock.com that every deal has to be a win-win deal. It’s how we hire employees. A product has to be a win for the customer and a win for us, a win with our suppliers and vendors. A deal’s got to work long term for all parties.

As a result, whenever I’m negotiating deals, I’m looking not for the best deal I could get, but a good deal for all the parties in the transaction.

I can think of the first contract Overstock negotiated with a fashion house on Seventh Avenue in New York City, to source some clothing. A year later, they came back and said the deal is not working for us, so we sat down and amended the contract. The year after that, we came back and they renegotiated. We’ve amended that contract 12 times. It’s finding win-win deals, and when they’re not win-win deals, adjusting them to become so.

Follow Jonathan Johnson on Twitter at @JJohnsonNow. Follow Overstock on Twitter at @Overstock.

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