1、Win or lose?Win Win?Negotiations can be categorized into two types by how people looking at the results of negotiations:the distributive,representing win-lose result and the integrative,representing win-win result.WinLoseRelationship:simple and secondaryIssues:simple and tangibleReward system:win or
2、 loseAssumptions:only present interestsStrategy usedTo reduce others resistance to making of concession To reduce others estimation that you will concede To exploit others trust,low skill and inexperience To exploit information asymmetry Price Negotiation and Cost Analysis Two basic cost functions v
3、ariable costs:raw materials and labor Fixed costs:supplier has to bear irrespective of whether it manufactures anything or not,such as rent,rates,insurance,wagesFixed Cost Elements planning and production expenses expenditures on plant and equipment,and such administrative costs as salaries,insuranc
4、e,depreciation and interest on overdrafts marketing and distribution costs cost of running the marketing operation(including the sales force),provision for retailer support Variable cost+fixed costs=cost of product+profit margin=selling priceEquation of cost structureProfitNegotiations on PriceNegot
5、iations on PricePrice ZoneBuyers negotiation zone First offerBottom lineFirst offerSellers negotiation zone150180170200BuyerSellerZone of possible agreement 10Integrative NegotiationThe word integrative by concept implies some cooperation,or a joining of forces to achieve something together.Integrat
6、ive negotiation usually involves a higher degree of trust and a forming of a relationship.Integrative Negotiation BasicsMultiple IssuesInformation sharingProblem SolvingBridge BuildingStrategies for Integrative NegotiationGain first hand informationPlay FairPresent Multiple OffersThird Party Assista
7、nceNegotiation SimulationUsed Car SellerRequirement for negotiation:Read buyer and sellers part in the book respectively;Discuss with your partner your negotiation strategy,including your first offer,bottom line,and the zone of possible agreementRalphs Manual of used car prices How did the buyer fin
8、d out the price of the equipment was over valued?Point out those factors which make it possible for the buyer to make the cost analysis.(1)What is the most important point for Sarahs success dealing with WalMart?(2)How did Sarah turned a distributive negotiation into an integrative negotiation?(3)Why did Sarah suggest that“Trying to bluff Walmart buyers is never a good idea”?(4)Why did Sarah suggest that“Try not to let Walmart become more than 20%of your companys business”?(5)Why is it important to“go into a meeting with a clear negotiation agenda”?
