There is a lot of advice about how to plan and execute supplier negotiations, but the key to success is understanding the objectives and tactics of the supplier.
Counter-tactics can improve negotiating outcomes for procurement professionals. For example:
Know where the supplier is in their sales cycle.
The supplier may be at the stage of prospecting, identifying needs or proposing a solution directly to budget holders or functional managers. The procurement person will be using different conditioning and influencing methods at each stage.
Remember, the supplier will sell first and negotiate second.
Avoiding negotiation is a smart way of deal-making for suppliers. Procurement can counter this by starting the negotiation process first, and early.
Recognise the supplier closing tactics.
There are many ways a supplier will try and close discussion and make agreement. The procurement professional needs to be in control of this. Taking charge of the progress of discussion blocks the suppliers attempts to close too soon.
There are 3 ways you can learn more about supplier negotiation tactics and how to tackle them:
- ADR’s Online Procurement Academy for Negotiation: eLearning for people who negotiate with suppliers
- ADR’s Online Supplier Influence Course: An instructor-led webinar for in-house teams
- ADR’s Negotiation Tactics Training : A role-play based classroom course for procurement people