PurchTips - Edition # 106
Suppliers' Secrets For Negotiating With Purchasing
By Charles Dominick, SPSM, SPSM2, SPSM3
What Do Your Suppliers Think When Negotiating With You?
I recently interviewed Ken Knudsen, the CEO of sales coaching firm Eagle Rock Enterprises, about suppliers' thoughts when negotiating with purchasing managers. We identified several negotiating principles for purchasing managers.
From the supplier's side, "the key to negotiation is that you have to start with a pretty wide spread," Knudsen shares. "If my goal is to sell something for $20 a case and I open at $20, we don't have negotiation room. Most sales professionals have something in their 'back pocket'."
So what can compel a salesperson to offer the better deal in her "back pocket?" The goal of many salespeople is to earn more and work less. That goal is best accomplished by working with customers with long-term relationship potential.
But that doesn't mean that a purchasing manager's only necessary negotiating tactic is to promise a long-term relationship. Salespeople are trained to identify whether a purchasing negotiator is serious or bluffing.
Before negotiating, they consider the states of the purchaser's company and the industry. While negotiating, they evaluate
the body language of the purchasing manager. Certain actions may signal a dishonest representation, such as:
There are really two lessons to be learned with regard to body language:
"One of the things that I coach clients on is that you should always take someone into the sales call with you because they're observing while you're trying to present," explains Knudsen. "Most purchasing managers try to (negotiate) one-on-one or one-on-two" and, therefore, fail to be as effective at observing the supplier's body language.
To Knudsen, an indicator that the purchasing manager is interested in a long-term relationship is the manner in which the purchasing manager communicates. I pointed out that purchasing managers often open a sales call or a negotiating session with a phrase like "You have five minutes, what do you got?" Knudsen identified that as one of many "red flags" that positions the purchasing manager as a "short timer" and compels the salesperson to withhold better deals.
Knudsen acknowledges that one of the salesperson's objectives is to get the purchasing manager to talk, but also says "Most purchasing managers should try to get the salesperson to talk more." By learning about a salesperson's objectives, the purchasing manager can uncover opportunities for good deals that the supplier is withholding for potential long-term relationships or "reference accounts." Sometimes, salespeople are sent into a meeting with the instructions: "Price is not an issue. Get the account." But purchasing managers risk never discovering that if they don't foster an open dialogue.
Purchasing managers are often reluctant to share information, and Knudsen sees that as a barrier to their success in negotiating. He says that the sharing of information is often important for a salesperson to be able to go back to her management for approval to offer a better deal.
I agree, but I also feel that purchasing managers need to be proficient at distinguishing good-intentioned salespeople from
unscrupulous ones who are just seeking a negotiating advantage. So, no single rule applies to the sharing of information
in a negotiating situation. The purchasing manager has to make the decision that is right for the specific circumstances.
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Spotlight On Professional Development Opportunities
Are you tired of not getting enough opportunities, respect, and money out of your purchasing career? Well, guess what? Nothing will change unless you take action towards becoming a world-class purchasing professional.
You see, today's employers refuse to reward employees for yesterday's skills.They demand that purchasing professionals like you use the most modern skills and achieve unprecedented results. They want you to save more money, achieve better operational performance, and reduce risk.
Is lacking a purchasing certification keeping you from getting the results, opportunities, respect, and money that you want out of your career? Today's employers refuse to reward employees for yesterday's skills. They want you to save more money, achieve better operational performance, and reduce risk. They demand that purchasing professionals like you achieve unprecedented results and without the most modern skills that can be a challenging feat!
So how can you acquire the most modern skills, achieve meaningful results, and convincingly prove your capabilities to today's employers? There is an impressive purchasing certification program that will teach you what you need to accomplish all of this and more. It is the SPSM® Certification, earned by completing the Senior Professional in Supply Management® Program. And you could earn it in less than a year - maybe even much less than a year!
Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is the action to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSM® Certification (and perhaps get an iPad) (with the option of getting a Study Guide on an iPad) at:
Distinguishing yourself as an achiever in purchasing is key to sustaining a rewarding career, even in these difficult economic times. Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSM® Certification (and perhaps get an iPad) at:
Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is the action to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. And if you sign up for the Senior Professional in Supply Management® Program on or before May 31, 2008, SPSMSM Certification Program on or before 4/30/2007, you also get these and other bonuses valued at over $700:
To learn how to earn your SPSM® Certification and get these valuable bonuses, visit:
Earning your Senior Professional in Supply Management® (SPSM) Certification is the action to takeif you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSMSM Certification at:
Learn how to earn your SPSM® Certification at:
The Latest Purchasing News!
Did you learn from this article? can learn more by listening to or downloading a podcast recording of my interview with Ken Knudsen from our new Purchasing & Supply Management Podcast page.
To Listen To Or Download The Podcast, Please Visit
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