Next Level Purchasing - Helping Purchasers Become Indispensable
Home   |   Contact Us   |   Email This Article To A Friend  |  
Photograph of Charles Dominick, SPSM This is the Web-based version of this article. Click here for the printer-friendly version.
  * More Purchasing Articles

Using Collaboration In Negotiation: 3 Steps


PurchTips - Edition # 219

By Charles Dominick, SPSM, SPSM2

 

How Can You Collaborate When You Negotiate?

Win-win negotiation uses collaboration as opposed to confrontation as the basis for persuasion. In some negotiations where you and your supplier have opposite positions on an issue, you may think that there is no opportunity for collaboration. But there usually is if you use these three simple steps:

  1. Have both parties share what their interests are. In our online class "Powerful Negotiation For Successful Buying," we teach that an interest is a need that you desire to have satisfied and a position is one scenario that could satisfy an interest. For example, a supplier may have an interest in making a 20% profit margin on its sales to your organization and its position will be that it wants to charge $5.00 per unit. Your interest may be that you achieve a 10% cost savings and your position is that the supplier should reduce the price to $4.50. If you've reached an impasse, it can be more effective to discuss interests rather than argue over positions.
  2. Brainstorm to identify several possible solutions. After interests have been discussed, ask the supplier to work with you to come up with multiple scenarios that would enable both parties to achieve their interests. The goal is not to come up with the perfect solution just yet, but to gather several different ideas that can be later pared down. Don't feel the pressure to do all the talking. Sometimes, a supplier can come up with a good idea and they will be more likely to buy into it - or at least reluctantly honor it - if they come up with it as opposed to you imposing it on them. For example, the supplier may say "I could get the price down to $4.50 if you opted for a single material packaging instead of a two-material packaging. I'd still make 20% because my costs would be lower and you'd achieve your savings."
  3. Jointly select the best solution. After brainstorming, you may have to whittle down some of the suggestions that just won't work. But, hopefully, you've come up with several potential solutions that accommodate both parties' interests. Together, you and the supplier should select one that makes the deal feel like a "win" for both parties.

(keep reading for a FREE Offer)

Spotlight On Professional Development Opportunities

SPSM Certification

Are you on the forefront of purchasing certification technology? Now you can earn the most advanced purchasing certification, the SPSM® Certification, using the some of the most advance technology available.

Forget the outdated and old-fashioned text books that you need for other purchasing certifications! Last week, we announced an exciting new way to earn your SPSM® Certification- using an iPad! The iPad is a powerful tool for today's purchasing professional giving you immediate access to information that you need, right at your fingertips.

And for a limited time you can save $100! Simply enroll prior to Sunday, December 19, 2010 and use the coupon code IPAD10 during enrollment to save an additional $100.

To learn more about earning your SPSM® Certification on the iPad, visit:

www.NextLevelPurchasing.com/ipad



The Latest Purchasing News

 

FREE Offer!

Not sure if your procurement department is structured appropriately? Our new whitepaper entitled "Separating A Procurement Department Into Tactical & Strategic Teams: Is It Right For Your Organization?" will help you make that determination.

To Get Your Copy of
"Separating A Procurement Department Into Tactical & Strategic Teams," Visit:
http://www.NextLevelPurchasing.com/sts .


Copyright 2010. This article is the property of Next Level Purchasing and may not be copied or republished in any form without the express written consent of Next Level Purchasing. Click here to request republishing permission.