While technology has become integral to procurement, sourcing professionals still use negotiations to get the best deals from suppliers and to forge long-term relationships.
If you are a procurement professional, here are some tips to help you negotiate with suppliers so that you enjoy winning outcomes every time you sit across the table:
Learn about the supplier
Get familiar with the supplier’s company, so that you will be well-prepared for the negotiation. Check the supplier’s website and get detailed information about the different business lines, growth plans, company history, and operational facilities. You can also do some research on Google and LinkedIn to find other customers and connect with their procurement professionals to learn more about the non-confidential parts of their negotiations. Collect as much information about the supplier’s company as possible so that you can identify their strengths and weaknesses before negotiating with them.
Find out more about the supplier’s strategy
You can email the supplier before the negotiation talks to prepare a written agenda for the meeting. In it, state the names and designations of people attending the meeting and a list of issues to be discussed by the supplier’s organisation and yours. It will let you know beforehand who will be participating from the supplier’s side and the topics that will be discussed, enabling you to prepare talking points.
Profile the supplier’s negotiating team
Find out as much as you can about each participant attending the negotiation. It can make a difference to the way you handle deals with the supplier. Get a feel of them through their social networking sites and ask executives from the supplier’s company about each person. But, ask a few months before the meeting is scheduled. Profiling each person will empower you, as you will know how to deal with them during the negotiation.
Make sure that you also select your negotiation team carefully. Have procurement professionals who possess stellar negotiation and leadership abilities, and hold the decision-making authority within the scope of the negotiation.