making a deal part – ii

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MAKING A DEALPART – II


During the negotiation Establish a framework

Make constructive approaches

Choose honesty, which can result in a lifetime of improved communication

Be clear and firm but flexible when bargaining

Recognise problems and brainstorm alternatives to correct them

Handle conflicts positively because the relations is more important than winning

Compromise without losing face

Check your understanding and assumptions by asking questions

Think the customer is always right even when he/she is wrong


• May I suggest that we have a look at what we have done so far?

•How does that sound?•It sounds good to me. Let's do

this.•I assume it would be fair to say….

•Perhaps what we're looking for is…..

Clarifying Positions


At the end of the negotiation

Agree on the deal and sign a contract

Build up new relationships


• We might be able to consider your offer, if you respect our deadlines.

• We can agree on that if you are prepared to send your order by the end of December.

• I think we have a deal.• We'll meet your

requirements.• We are expecting a

written agreement asap.• Fine it remains just for

me to thank you.

Reaching an Agreement


Negotiation Meeting between a television manufacturer and a components company for a 2 year contract for

components

Fleur: So, we could supply you with 40,000 components per month, for a two-year period at a unit cost of $4.35 per component.

Bill: There seems to have been a slight misunderstanding. You do realise that we want to order nearly a million components. And for that quantity, the price per unit does seem to be very high.

Fleur: We have taken into account the size of the order you require. And we have reduced the unit price markedly from what we normally ask. In terms of unit price, what were you thinking of?

Bill: Well, we were hoping for something around $3.40 per unit. Please bear in mind that we want to order nearly a million components, not a thousand.


Fleur: $3.40 per unit. I am afraid that is out of the question. If we sold it to you at that price, we would be making loss on every unit sold.

Bill: Well, we have received a quote from one of your competitors at $3.53 per unit.

Fleur: I am afraid that we can't match that. But If I was were you, I would be asking myself how can they sell the components at such a low price? I would say that they are sacrificing the quality of the component for price. But there may be some room for maneuver. If you were to increase your order to 50,000 components per months, then we could lower the unit cost to $4.15.

Bill: For 50,000 units per month we wouldn't expect to pay more than $3.85 per unit. I would say that this price is the going rate for this quantity.

Fleur: I don't think that we could go that far. Under $4 per unit. It's not enough.

Bill: Well, could you meet us halfway? At $4 per unit?

Fleur: If that's $4 per unit, 50,000 per month for 2 years. I think we can do that.


Choose the correct option

1. We started talking because our common ground was to agree ___ the contract.a) on b) to c) with

2. If only he could have agreed ___ start it all over again.d) with e) on f) to

3. They had never ___ him in the first negotiations, why would it change now?g) agree withh) agreed withi) agreed on

4. They needed someone to ___ the meeting.j) chairk) rulel) preside


5. They were asked to ___ concessions.a) do b) resolvec) make

6. Do you have any questions ______?d) by nowe) from now onf) so far

7. Let me now ____ our future prospects.g) switch onh) turn toi) turn on

8. I didn't think you left any room to maneuver. ____ I.j) so didk) neither dol) neither did


9. I wish you ___ the whole thing.a) could thinkb) would thinkc) would reconsider

10. I am afraid that ___ our requirements.d) wouldn't meete) would meetf) won't satisfy

11. That follows the law of ____g) offer and demandh) supply and demand i) supply and offer

12. We have a ____ to offer.j) countering offerk) counter suggestionl) counter proposal


13. We value consensus in all transactions. So a) does itb) we doc) do we

14. Now the ___ session has started!d) bargainse) bargainf) bargaining

15. We ___ agreed on the most important issues.g) areh) havei) were

16. They decided to ___ a proposal.j) do k) decidel) make


17. We have a deal ___ you respect our deadlines.a) on conditionb) unlessc) Provided

18. I am quite happy with what we agreed on so far. So ___ we.d) aree) do f) did

making a deal part – ii

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