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Thursday, November 20, 2008

Negotiation Skills

For everything you wanted to know on building leadership and management, refer Shyam Bhatawdekar’s website:

(Refer our High Quality Management Encyclopedia “Management Universe” at:

For write-ups on other topics of marketing and sales management, refer: (Marketing Management Overview), (Marketing Orientation), (Marketing Management Tasks), (Market research), (Market Segmentation), (Advertising), (Sales Promotion), (Sales/Selling Process), (Negotiation Tactics), (Objection Handling)

What is Negotiation?
  • Your real world is a giant negotiating table and like it or not, you are a participant.
  • You as individual come in conflict with others: family members, bosses, subordinates, sales people/suppliers, competitors, government agencies etc.
  • Negotiation is a common approach in making decisions and resolving conflicts.
  • Negotiations can be viewed as a problem solving process in which interested parties communicate their differences and attempt to reach a common agreement.
  • How do you handle these encounters can determine not only whether you prosper but whether you can enjoy a full, pleasurable, satisfying life.
  • Negotiation is a field of knowledge and endeavor that focuses on gaining favor of people from whom we want things. It is as simple as that.
  • What do we want? We want all sorts of things: prestige, freedom, money, justice, status, love, security and recognition.
  • It is not “haggling” or “price chiseling”.
  • Some of us know better than others how to get what we want. You are about to become one of these.
  • What is negotiation? It is use of information, time and power to affect behavior within a “web of tension” and you are negotiating all the time.
  • Changing of relationship between two or more people.


  • Arrive at reasonable and fair price and other terms for given specifications
  • Perform contract on time
  • Exert control over the manner in which contract is performed
  • To give maximum cooperation
  • Develop sound and continuing relationship

Three Crucial Elements of Negotiation

Information: The other side seems to know more about you and your needs than you know about them and their needs.
Time: The other side does not seem to be under the same kind of organizational pressure, time constraints and restrictive deadlines you feel you’re under.
Power: The other side always seems to have more power and authority than you think you have.

Almost Everything Is Negotiable

Whether you do or don’t negotiate anything should be strictly up to you based on your answers to the following questions:

  • Am I comfortable negotiating in this particular situation?
  • Will negotiation meet my need?
  • Is the expenditure of energy and time on my part worth the benefits that I can receive as a result of this encounter?

Steps of Negotiation Preparation

Seven Stages of Negotiating Process:

1. Examine purpose and nature of conflict. Solve the correct problem.
2. Identify objectives. What are the consequences?
3. Classify facts. Faulty assumption + Expertise = Faulty conclusion.
4. Establish agenda. Consider issues of all the parties involved.
5. Select position. Position represents a preference toward a particular outcome.
6. Assess need. Needs and their satisfaction are the common denominators in negotiations.
7. Determine strategy and tactics.

Features Other Than Price

  • Longest time in business: rich experience.
  • Only Manufacturer.
  • Knowledge of all the problems and related solutions.
  • Only company giving two years unconditional warranty.
  • Exporters to particular countries.
  • Largest installation base.
  • ISO 9001 company.
  • Own field staff, own sales staff and value added retailers.
  • Stock of spares at every branch.
    Etc etc.

Typical Negotiating Positions

Buyer’s position
Minimum - Objective - Maximum

Seller’s position
Minimum - Objective - Maximum

Essence or heart of negotiation lies between the objective positions of buyer and seller.

For More Guidance, Assistance, Training and Consultation


Also refer: (Prodcons Group)
(Training Programs by Prodcons Group)
(Productivity Consultants)

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