How To Use A Negotiation Script
Are You Creating Scripts For Your Big Negotiations?
PurchTips Edition #374
By Charles Dominick, SPSM, SPSM2, SPSM3
You should go into every supplier negotiation with a script covering key concessions you are seeking. Use a negotiation script to predict supplier objections, then develop responses to convince your supplier to drop those objections. Here is a sample script for negotiating a lower price with a supplier. Use it as-is or create your own script based on this example!
Supplier: “We are offering the best price that we can.”
You: “If that’s the case, would you be willing to include a Most Favored Nations clause in the contract, stating that we will always receive the lowest price offered to any of your customers?”
Supplier: “No. We can’t do that.”
You: “Well, that tells me that you are offering a lower price to another customer, which means that there’s room for our price to be lowered. What is the lowest price that you offer to any of your customers?”
Supplier: “I can’t tell you. That’s confidential between us and the customer.”
You: “I understand. So, instead of telling me their price, simply tell me which of the following ranges it falls into compared to the latest price you offered me: 1-5% less, 6-10% less, 11-15% less, 16-20% less, or more than 20% less.”
Whatever range they answer becomes the target you should aim to match or beat. Challenge any reason that the supplier gives for providing a lower price to another customer. And continue to push for that Most Favored Nations clause – it can provide you a contractual guarantee that your price will be and remain low!
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