C Negotiating scenario

At the beginning of a negotiation, follow these steps:

1. Meet and greet representatives of the other company and introduce your colleagues.

2. Offer coffee and small talk. Try to create a relaxed atmosphere.

3. Go to the meeting room and suggest that you get down to business.

4. Have a clear agenda and a timetable.

5. First, give the background to the negotiations. Talking about the situation is a good way of reminding people of key facts and issues.

Lesson 11. Negotiating

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6. Then kick off the negotiations themselves, perhaps by finding out more about the priorities of the other side (the things they think are most important) or talking about your own requirements.

D Win-win. Probing.

In a successful negotiation, everyone should leave the negotiating table happy with the outcome: there shouldn`t be winners and losers. The negotiators should try to reach a win-win solution: an agreement of equal benefit to both sides. This can be achieved in a number of ways.

One way of furthering negotiations is probing (asking the right questions and listening carefully to the answer). Here are some probing questions:

a) What is the situation on production at your plant at the moment?

b) What sort of quantities are you looking for?

c) What are we looking at in the way of discount?

d) What did you have in mind regarding specifications?

e) What were you thinking of in terms of delivery dates?

f) How important to you is the currency for payment?

E Trade-offs

When you offer to change your position to one that is less favourable to yourself, you make a concession. Perhaps this is in exchange for a concession from the order side, although there is no guarantee of this. Your concession may be a goodwill gesture: a concession that you make hoping that the other side will see this as friendly and make a concession in return.

Even in a friendly negotiation, there may be horse-trading, with each side making a series of concessions in return for concessions from the other side. (This expression

Lesson 11. Negotiating

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is often used to show disapproval.) If you argue about something for a long time, especially the price of something, you haggle.

A series of concessions in exchange for concessions from the other side is a series of trade-offs. If you make a concession, you may not get anything back. If you make a trade-off, you give something away and get something in return.

Notes:

horse-trading – when two sides discuss a business deal in a very forceful

way, each one trying to get as much as they can without making

the other want to stop the deal.

6. Match the words with the definition:

1. negotiate     2. bargain     3. dispute     4. priority     5. fallback     6. venue     7. representative   8. agenda     9. kick off     10. win-win     11. probe     12. trade-off     13. concession     14. haggle

a) the thing that is more important than anything else, and that needs attention first; b) to discuss the conditions of a sale, agreement etc in order to get the greatest advantage for yourself; c) someone chosen to speak or make decisions for another person or group of people; d) a balance between two situations in order to get an acceptable result; e) to discuss something in order to reach an agreement; f) used to describe a situation in which both sides involved gain something or are successful; g) something that can be done if the original plan does not succeed, or that can be used if the thing that you want is not available; h) an agreement or rule allowing someone to pay less money, tax etc than they would normally pay; i) to ask very detailed questions to find something out, especially things people do not want you to know; j) a serious disagreement between two groups of people, especially a disagreement between workers and their employers in which the workers take action to protest; k) a place where a large event is arranged to take place; l) a list of the subjects to be discussed at a meeting; m) to argue about the price of something before reaching an agreement; n) if a meeting, event etc kicks off or you kick it off, it starts;

7. Jose Oliveira is head of Xania, a Brazilian aircraft manufacturer. He is preparing for negotiations with Zebra, an engine supplier. Match each point (1-6) in Jose`s notes with one of the tips (A-F) in B.

1. organize preparatory meeting with head of manufacturing and head of purchasing to discuss strategy

2. persuade Zebra representatives to come to our offices in Sao Paulo

3. principal objective: delivery of first 20 engines in six months; other objectives: flexible payment, strong quality guarantees; price less important, but aim for US $500,000 per engine; find out more about Zebra`s priorities

4. rumour says that Zebra are in financial difficulty: they badly need orders

5. will accept price up to US $550,000 if specifications are good

6. Zebra well-known in the industry for its “strong” negotiating techniques

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