Transcript International Trade Theory

Business communication
Chapter 7
Business
negotiation
Contents
How to prepare a negotiation
How to negotiate
Business communication. Swust. Shirley Miao
Business negotiation
A negotiation is a process of
communication between parties to
manage conflicts in order for them to
come to an agreement, solve a problem
or make arrangements.
Conflict is the reason why a negotiation
is possible to develop. A conflict is a
dispute(争论）, disagreement or
argument between two or more
interdependent parties who have
different and common interest.
Business communication. Swust. Shirley Miao
Business negotiation is a process of talking,
negotiating on business terms and
coming to an agreement at the end between
different business parties in pursuit
of their respective economic benefits.
Business communication. Swust. Shirley Miao
Business is negotiation!
You will negotiate to buy, to sell, to
conclude contracts with suppliers, to
fix the staff salaries and so on. What
is more, you have to negotiate with
regulators, Banks, Insurances. It
means that the business life is a
permanent negotiation with others
people who are defending their own
interests.
Business communication. Swust. Shirley Miao
International business negotiation is
a process of information exchanging,
talking and discussing, aiming at
coming to an agreement in order to
satisfy certain demand(s) of
participants’ from different nations or
regions in international business.
Business communication. Swust. Shirley Miao
A. How to prepare a negotiation
Preparation is a must!
Negotiating file are often complex and
in specific matter, you have better to
call a consultant.
What to Prepare?
Business communication. Swust. Shirley Miao
 Background
 Attitude
 Who is your negotiator opponent?
 What do they want?
 What do I want? Set goals in terms of
acceptable limits and that you have a
realistic chance of achieving.
Business communication. Swust. Shirley Miao
 What can I trade?
 Identify your supporting arguments that
justify your goals and the arguments
that the other party may use against
them.
 What strengths and weaknesses do you
take to the negotiating table?
 What are the strengths and weaknesses
of the other party?
Business communication. Swust. Shirley Miao
 What will be your opening gambit and
how will you present it?
 Timescale – how much time is there to
negotiate how imperative are deadlines?
 What will be your opening position, your
fall back position and your final fall back
position?
Business communication. Swust. Shirley Miao
Define your goals
Strategic planning determines the
goals and the moves to reach them.
A limited result could coincide(符合）
with a common interest. It's that
people call the win-win principle. You
must position on your plan the winwin result and you must define it in a
written sentence.
Business communication. Swust. Shirley Miao
You can just get the minimum issue:
It's your bottom line!
Business communication. Swust. Shirley Miao
Balance of powers
Any strategy begins by a clear
apprehension of the balance of
powers and consequently of the
possible movements.
Do not confuse this balance with the
quality of your case. May be, your
files are not good but if your
opponent has a big loss to expect in
case of failure, the balance of power
weights strongly in your favor,
despite the weakness of your files.
Business communication. Swust. Shirley Miao
Case
One of our suppliers complained that
we did not respect his contract and
that he could sue us.
In order to avoid a trial, he proposed
a negotiation and asked for
indemnities（赔偿）.
Business communication. Swust. Shirley Miao
I examined the files and I got to the
conclusion that our case was bad. On
the other hand, I examined his
financial statements. I realized that we
were his main customer and that he
had not too much cash.
Clearly, he could win a trial but
afterwards he could also close his
business. Despite a bad case, the
balance of power was in our favor.
Then I defined a strategy.
Business communication. Swust. Shirley Miao
B. How to negotiate
The negotiation is
mainly described
as a conversation
between polite
persons. The two
parties explore
their common
interests and try to
reach the win-win
option.
Business communication. Swust. Shirley Miao
Be Polite
Business etiquette
 Personal etiquette
(Image, expression,behavior)
 Meeting etiquette
(Introduction ,greeting)
 Conversation etiquette
(Listening,speaking)
Business communication. Swust. Shirley Miao
Where to sit?
Business communication. Swust. Shirley Miao
1
4
2
5
3
6
Door
1
4
2
5
6
3
Door
1.Opening
 As in chess game, the opening is very
important in any negotiation.
 Start with your upper position but try to
explain it as fairly as you can. Insist on the
idea that your goal is to find a common
agreement with a high value placed on the
constant relationship between you and your
opponent. Play the good Guy. Be courteous
（谦虚的） but nevertheless be firm to deter
the aggressiveness of the other party.
Business communication. Swust. Shirley Miao
2. Middle course
Usually, during the middle course, each
party tries to concentrate on the core
of common interests. Negotiation then
comprises common thought and not
confrontation（对质）. Try as much as
possible to change from being an
opponent to advisor analyzing with him
his own options. Use some technique.
Business communication. Swust. Shirley Miao
A good tip is to have
a colleague that
plays the inverse
role of you.
You are the naughty
and he is the good.
When you have just
attacked, he comes
to appease. The
goal is to
destabilize the
opponent with a
constant mixture of
hot and cold!
Business communication. Swust. Shirley Miao
Go to the win-win position and try to
defend it.
Always say that you are seeking for
solving a problem and not to gain a
benefit. Explore and take in account
the problem of the other party. Your
fellow should now be the naughty.
Let's him complaint and try to place
you above the fight just as if you
were a mediator between two parties!
Business communication. Swust. Shirley Miao
3. Ending
Be very careful about the final
minutes of the negotiation.
Thanks if you have survived. If the
result is too bad, you always can ask
for a delay. Anyway, when you have
given your agreement, you have to
respect it.
Business communication. Swust. Shirley Miao
Reference
http://negotiations.org/
http://www.negotiations.com/case/
国际商务谈判 刘向丽 机械工业出版社
双赢谈判 黎滔 中国纺织出版社
Business communication. Swust. Shirley Miao