Lecture on Negotiation Tips

Introduction

• Importance of preparation in negotiation.
• Aim: To enhance confidence and organization during negotiation.
• Common misconception: Negotiation is not just about asking for a better price outright.

Tip 1: Understanding Buying Power

• Currency Awareness
  • Know the value of your currency against the Chinese yuan.
  • Use currency charts to understand trends.
  • Strategy
    • If currency is appreciating (favorable): Ask about the exchange rate being used by the supplier.
    • If currency is depreciating: Avoid discussing the currency rate.

Tip 2: Use Comparative Analysis

• 1688 Website as a Resource
  • Pull up 2-3 comparable products from 1688 (Chinese Alibaba).
  • Show product images and prices in RMB to the supplier.
• Leverage
  • Convert Chinese RMB prices to your currency.
  • Use potential savings as a bargaining tool.
  • Maintain a firm stand while negotiating.
  • If supplier claims differences: Listen but remain firm for concessions.

Tip 3: Understanding Cost Drivers

• Inquire About Production
  • Ask supplier about materials and production processes.
  • Understand machinery and processes used.
• Objective
  • Determine if there's negotiation leverage.
  • Identify high labor costs or material benefits.

Tip 4: Competitor Analysis

• Preparation
  • Create an Excel sheet comparing supplier prices with competitors.
  • Present this data during negotiation.
• Tactics
  • Claim competitor prices are lower to push for a better deal.
  • Use Excel data to convince rather than relying on verbal assertions.

Conclusion

• Emphasize the importance of data and preparation in negotiation.
• Aim for a strong, informed position going into discussions.