b2b case-sarvesh dubey

7/30/2019 B2B CASE-Sarvesh Dubey

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Presented by : Piyush Pallav

Saurabh Chaudhary

Sarvesh Dubey

Kapil Shrawat

Jitendra Kaswan Abhishek Dwivedi


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Topic of the Case Study- Negotiations between ElectricalEquipment Ltd. and Voltas Ltd.

Electrical Equipment Ltd (EEL) - Manufacturers of Flame-Proof Motors.

Voltas Ltd - Renowned Original Equipment Manufacturer(OMakers of Centrifugal Pumps.

The flame-proof motors coupled to the pumps - removes waccumulated in underground mines.


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1) Flame-proof motor- Maker - EEL, Cost - Rs. 50,00Specifications - 40HP, 1400rp

Used in - Underground Minin

- Designed to avoid explosions when inflammablegases come in contact with a spark.

2) Centrifugal Pump - Maker - Voltas Ltd

Used in - Underground Mining


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- FROM EEL -

(1)Suresh Kumar- Regional Marketing Manager - Eastern Reg(RMM-E) of EEL.

(2)Pradeep Das Gupta - Sales Engineer , EEL - Kolkata.

- FROM VOLTAS -

(1)Murli Bhasin - General Manager ( Materials ) of Voltas Ltd


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Voltas acquired order for 10 pump sets from Eastern Coalfields at acompetitive price.

EEL - already sent quotation for supply of 10 flame-proof motors.

Competitors for EEL - Siemens, ABB and Kirloskar.

Volume Discount - 20% on basic price

Maximum Discretionary Discount offered - 12%

Supplier-buyer relationship would play a key role in bagging the ordfor EEL.


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AT THE MEETING

Mr. Bhasin comes straight to the point - The Price.

Demands for weekly delivery of 2-3 pumps from 4th week,

completion in 8 weeks. Mr. Kumar disagrees.

12-18 months warranty, free after sales service for the same peroffered by EEL. Mr. Bhasin agrees.

Mr. Bhasin demands for additional 15% discount instead of 12% boffered.


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Basis VOLTAS EELDelivery to commence 4weeks 6 to 7 weeks

Delivery completion 8 weeks 8 weeks

Penalty o.5 % per week o.5 % per week

Freight borne by EEL Accept ( additional coof 3 -4 per cent)


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Basis VOLTAS EEL

Motors per week 2 or 3 per week All 10 in truck load toavoid damage

Warranty accept 12months from date otallation or 18 monthsfrom date of dispatch

whichever is earlier

Discount 15 percent 12 percent


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The EEL Team discuss and decline offer - thinking Mr. Bhasin migbe lying.

Meeting ends with Bhasin informing that they will negotiate with

competitors, result in 3-4 days.

Order important for EEL. The EEL team wonders if any otherstrategy could have worked.


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Negotiation is a process that tries to maximize the benefit to bo

buyer and seller

Mr. Kumar adopted a passive-balanced strategy.

Business with Voltas important for EEL. Hence, allowed them soconcessions.

Provided discretionary 12% discount too.

Although, could have taken a more dominant position.


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Mr. Kumar gave in too much too soon.

Rather, he could have been compromised with freight charges.

Could have explained the services they were offering as a compr

on price.

Could have explained the benefits of dealing with EEL to Mr. Bha

Competitors might not offer even this much discount.


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Style of negotiation - I WIN - YOU LOSE

Straight away took control of the meeting - Dominant stance.

Manipulated terms and conditions under pretext of stiff price

competition.

Put forth only their conditions. Did not consider EELs.

Voltas - Reputed Company. EEL might need their business. Hencecould demand.


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Mr. Kumar was right in allowing only 12% added discount.

Demand from Voltas was unrealistic.

12% discount - Win-Win situation for both parties.

Both companies working on thin margins. Hence the 12% was

appropriate.

Although business with Voltas desirable - 15% would be stretching

too much. Hence, correct impression provided.


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THANK YOU !!

b2b case-sarvesh dubey

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