Of all the common phrases uttered during a negotiation, few get the response as the famous "Take it or leave it" (this is my last, best and final offer) comment.

Understand, when this comment is injected into a negotiation it is usually a sign of frustration and even hostility on the part of the person saying it. 

Let's examine the options available to us when we hear that from our negotiating opponent.

Option 1:  Soften and ask for negotiations to continue.  It might sound like, "Whoa, Fred.  I'm disappointed that you're taking that harsh stand at this point.  We've lots to talk about.  Aren't you at least open to considering additional possibilities?"  If they continue, it's likely they've moved off their hard line position.

Option 2:  Ignore it and keep negotiating.  Seamlessly move past hearing that comment and ask for details about one of the negotiable items.  Act as though you didn't hear what they said or that you're not accepting their ultimatum position.  Many people regret saying that hard line phrase and are even relieved when someone seems to by-pass it without comment.

Option 3:  Test it by breaking off negotiations.  This is similar to Option 1 where you voice your disappointment at their suddenly halting negotiations by stating their hard final position.  But here, you state that you need to step away from the negotiations.  You actually leave, depart and move away for a period of time.  Be sure and suggest that both sides try to come up with options, not yet considered, and get together later.  Most hard liners, who really want this deal, will adopt a calmer, softer and 'let's keep talking' posture when they meet again.

Option 4:  Pull items out or put items in.  If someone says this is my best price (take it or leave it), suggest items that can be stripped out that would make that price acceptable.  Each negotiation is unique, but perhaps previous concessions can be retracted or additional items asked for at the price suggested.  Timing, warranties, delivery, repeat business, recommendations, delayed payment and increased quantity identify other issues that can be considered to make that price acceptable.

Option 5:  Call for higher authority.  When the 'take it or leave it' position is communicated, ask to talk to someone else in the mix.  Ask to speak to the manager, the broker, the boss or the spouse.  Not all situations have another 'higher' authority, but there are always advisors that can add another dynamic.

Face it, if someone doesn't want to deal and doesn't have to sell or buy, the 'take or leave it' can be fatal and final to the negotiations.  But it's most likely posturing that needs to be tactfully and gracefully challenged.  Don't ever get upset or become insulted.  Look for options to get past it.