Negotiation skills are critical in business since they help business people attain the best deals. Negotiation in business is a process that requires prior planning to ensure achieve the best payoff for the business owners. This paper presents a negotiation plan for a firm that seeks to enter into a supply contract.
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Palmer (2006) observed that the main objective of negotiations in business contracting is to attain certainty. Certainty entails detailing and specifying the goods to be supplied under the stipulated contract. Moreover, the timelines for supply, the standards, and the effects of delays in supplying are discussed and agreed upon.
The second objective of negotiating contracts is seeking to attain the best deal. This entails clarification of issues that are brought up on the negotiation table. Each specific detail of the deal ought to be explored to avoid re-emergence of issues when the deal has already been brokered. Compromising is critical in the process since one of the main aims of negotiating is to ensure that each of the party gains (Palmer, 2006).
According to Palmer (2006), the other objective of contract negotiation is to enter into a long-term business deal. Establishment of business networks is critical in the contemporary business environment. Therefore, there is a need to establish trust with certain business parties through negotiation. This assures the company of quality and quantity of supplies from a given partner.
Negotiation objectives are often inclined towards the objectives of the organizations that are a party to the negotiation process. The aim of engaging in a negotiation is not necessary to get the highest payoff, but also to ensure that the broader business objectives of the company are catered for during the negotiation. This can be obtained even when a substantial number of specific objectives for the negotiation have not been fully attained (Kennedy, 2007).
Negotiation is often a complex process. Thus it is critical to ensure that prior plans are set to enhance the efficiency and effectiveness of the negotiation. The first stage in the negotiation of a business contract is the development of capabilities of the company to negotiate the contract. This forms the basis on which the readiness of the company to negotiate the contract is attained (Garrett, 2005).
This sub-process begins with strategizing on the contract. Development of a contract calendar is critical. It is important to unearth information on other contracts that the company has done if the company has not entered into a contract with the supposed partner before. Establishment of contract requirements comes after ascertaining the company as a worthy partner. The contract requirements are then drafted and communicated to the negotiation team. It is vital to ensure that the expected outcomes of the contract are communicated to the negotiating team. The negotiating team will also be equipped with information on business contracting and critical factors to peg on when negotiating. Assessment competencies are also important, and they come after the establishment of the negotiating. At this stage, best practices as far as contracts by the partner are concerned are observed and analyzed by the negotiating team. The negotiating team is dispatched to the negotiating table when it is ready. Here, the conditions and terms for negotiation are discussed and agreed upon. This is followed by a real exploration of the contract details and subsequent review of the pre-agreement reached before ascertaining the agreements (Garrett, 2005).
Garrett, G. A. (2005). Contract negotiations: Skills, tools, and best practices. Chicago, IL: CCH.
Kennedy, G. (2007). Strategic negotiation: An opportunity for change. Aldershot, Hants, England: Ashgate Pub. Co.
Palmer, A. (2006). Negotiation: objectives. Negotiation.Biz Magazine. Retrieved from http://www.negotiation.biz/negotiation_objectives.htm