Chapter 9

Preparing for the Negotiation Session准备谈判

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I'm sorry, Bill, but I can't help you.

US$6.37 per unit delivered to your factory in Taiwan is the best I can do.

For Your Informaiton(背景介绍)

Negotiations requre preparation. You have to do your homework. Both sides need to know all they can about the other, just to know what to expect. The buyer needs to know all he can about the product, what else is available, the properties it must possess, the cost of parts acquired from subcontractors, and production costs. Basically, he must know everthing the manufacturer knowns. The seller has to know who the buyer will sell it to, and the price range it has to meet to be competitive.

If you're buying components, check with your production staff for special packaging, manufacturing or assembly changes the source can do cheaper than you. You should look for things that would reduce your production cost more than it would increase theirs. Then, compute exactly how much that would reduce your overhead on a per unit basis, and the total projected savings for this purchase.

There are two ways to introduce these cost cutting steps. You can include them in the bid specification. This is clearly the best way to go in most cases. If you know the supplier is difficult and something unreasonable on price, it may be better to not include them in the contract. Don't put them on the table at the start of negotiations. Use them as bargaining chips during the talks. For example, let's say you've worked out the problems and it's a matter of price. You need a certain price to make the deal work, but your supplier refused to come down a something you can afford. This is where you put the bargaining chips into play.

If you know how much these extras reduce your overhead, factor it into the price and increase your offer accordingly. If you have discussed all this before you left home, there's nothing to figure at the table; you know right where you stand. Of course, you don't offer the entire savings at the start, but let the other side negotiate you to a higher amount. They'll feel like they've gained something and who knows, maybe they'll accept your first price. Almost any trade off can be used as a bargaining chip. A trade off is when one side offers something valuable to the other side. There are several frequently used types we'll cover here, and this isn't a complete list.

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