Logic influences negotiation outcomes. Or at least negotiation expectations.
Big companies get good prices from their suppliers, who take a loss on the deals. Sole source suppliers propose high-margin prices and never lower them no matter how much kicking and screaming the buyer does.
Right?
Not always.
Negotiations are also very heavily influenced by emotion. How the negotiators feel. Even if those feelings are inconsistent with logic.
So, as described in the article, go into a procurement negotiation with the goal of assuming the superior role to your counterpart's subordinate role. You can turn the tide of a negotiation scenario with what you say and how you act.
For example, which of the following do you think is the more peruasive thing to say?
- (Looking at your tablet) "Can you lower your price?"
- (Looking the supplier in the eye) "The bottom line is this: we cannot, will not pay the price you have proposed. We absolutely expect you to shave $10,000 off of it before we can get serious about moving forward."
Don't be meek. Interject some (well-controlled and still professional) attitude into your negotiation repertoire.
To Your Career,Charles Dominick, SPSM
President & Chief Procurement Officer
Next Level Purchasing, Inc.
Struggling To Have A Rewarding Purchasing Career?
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2 comments:
All well and good to take strong position like that, but you better be prepared if the supplier says "fine", and walks away. It's a matter of leverage and having alternatives that creates the ability to take a hard line.
I agree, Brent.
Two points I want to add:
1. Leverage is part reality and part perception. How one conducts him or herself during the negotiation can influence the perception of leverage.
2. The key is to be professional, not rude. A supplier will generally not refuse to do business with a tough negotiator who is not rude. The likelihood of the supplier walking is much greater when the negotiator is rude. And rudeness is not just conveyed in words. It is conveyed in tone of voice and non-verbal communication.
Thanks for chiming in!
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