He loves to haggle
By MICHAEL S. ROSENWALD Washington Post
Published June 5, 2007
WASHINGTON - Jim Sullivan, Marriott International's chief dealmaker, is an accomplished talker. A hotel owner he frequently negotiates with says, "Don't call Jim unless you have some time." His language, like his personality, is sometimes blunt, frequently colorful and occasionally salty - the product of his scrappy Irish Catholic upbringing near Boston.
Sullivan, 63, is the third-highest-paid executive at Marriott, and though he is not the hotel chain's most visible figure - that would be the fellow with his name on the front door - Sullivan's role as head of lodging development is arguably its most important behind-the-scenes job. Marriott makes money when the heads of travelers are on its pillows. One of the primary ways the company grows is by raising room rates as much as possible; but for long-term, sustained growth Marriott must add more beds for more heads.
Sullivan has a staff of 250 Marriott dealmakers around the world. In the past three years, as the industry has boomed, they have added nearly 70, 000 rooms to the company's system. That means Sullivan's fingerprints are visible on the balance sheet. Marriott's base management fees to run hotels for their owners have grown from $388-million in 2003 to $553-million last year - a 42 percent increase.
Sullivan's outsize personality is complemented by his reputation for being a gentleman - a very tough gentleman - and even when he gets the better end of a deal, the other person doesn't feel like a loser. Fred Malek, who used to work for Marriott and now buys and sells its hotels at his company Thayer Lodging, puts it like this: "I have never reached an agreement in which I felt that I had not been out-negotiated." On the other hand, he said, "I have never felt like I was treated poorly or that the deal wasn't a good one for my partners or investors."
For the company's most important deals - particularly for acquisitions, like that of the Ritz-Carlton chain in 1995 - Sullivan is at the center of the negotiating table, talking incessantly and, as he puts it, "building a bridge from his objectives to your objectives."
"What I try to do is encourage the other side to talk, and I know that's hard to believe because I talk so much, " Sullivan said. "But one of the reasons I talk so much is that the other side gets comfortable ... talking, and then they talk a lot. And then you listen. Then you ask questions."
Then the contours of a deal slowly emerge. It is a taxing process that Sullivan's boss, Bill Marriott, gladly leaves to him. "He's got a lot more patience than me, " said Marriott, who at age 75 is still running the company with a firm hand. "I won't haggle with someone hour after hour like he does. I don't have that kind of patience. If he decides he's gonna get something done, he gets it done."
Jim Sullivan's art of the deal
Jim Sullivan makes deals every day. So we asked him for advice on one of the most common deals the rest of us make.
"First, understand what kind of car you want and why you want it. Do I want that car for transportation or do I want that car because I want people to know that I am very important and I can afford it?"
"Number two, do your research. Talk to other people who have them. Say, 'What did you pay? Do they negotiate?' "
"Number three, understand what's going to happen to you after you buy it. How do I get service? Is it good service?"
"As a matter of principle, at least 50 percent of things people buy are negotiable. So you never just say, 'How much is this? Thank you very much.' You ask how much is this, and then you act startled. You say, 'Wow, is that the best you can do for me?' "
He asks this even if he's buying his wife jewelry, and she's right there.
"Why should I be embarrassed? It doesn't embarrass me. I think it's a fair question. It's what I do."