Posted By : Admin Saturday, September 08, 2018 11:58:23 AM
Effective supplier negotiation is key for every professional working in a Procurement department. However, it is often more difficult than most new workers imagine and it poses greater challenge than initially expected. Nevertheless, if you are prepared, know what to expect and what it takes, you can ensure that every single commercial negotiation you make is successful and suits your needs.
In order to ensure successful negotiation, every professional in a Procurement department needs a set of good negotiation skills. Some of the most essential skills include ability to analyze and solve problems, preparation, active listening, emotional control, verbal communication, decision making, and last bust certainly not least, ethics and reliability. All these will ensure that you are able to identify the needs and interests of each party involved in the commercial negotiation, allow you to set realistic goals and prepare yourself for the process, find areas for compromise and control yourself, and lastly, build a long-term relationship with the client that is beneficial for both of you.
Know Every Negotiation Style and Carefully Choose
There are numerous negotiation styles, and each comes with different approach. Choosing the right one will guarantee your success, but this requires knowledge about the supplier's personality and negotiation background. There are five main negotiation styles, and the first of them is avoiding. It is typical for Procurement professionals who tend to avoid confrontations and prefer to stay tactful and diplomatic. The second style, Accommodating, is used by individuals who look to solve the other's problems and preserve business relationship at almost all costs.
Another well-known style is collaborating, which includes negotiations focused on solving problems in creative ways. Then there is Competing, who is used by individuals who always look for win most out of every commercial negotiation, but can be quite intrusive and is risky for the business relationship in the long run. And lastly, there is the Compromising style, which is suitable when you are looking to seal a fair deal for both sides.
Additional Things to Consider
That being said, it is important to note that these styles are also typical for suppliers too, and each style has both advantages and disadvantages. There is no one and true style that is most successful, procurement professionals must be flexible and have numerous negation styles at his or her disposal. And when it comes to supplier negotiation, there are a number of aspects one should carefully consider before entering into talks and choosing a style. These aspects include cost, value for money, delivery time, payment conditions, quality standards, and importance of each product that is being delivered, amongst all others.
ERDANO - Localize your Business Globally