Knowing your supplier is one of the best tools, weapons, instruments – no matter how you want to call it – to control the situation and always have the benefit in discussions, negotiations, day to day purchasing activity.

“Knowing” the supplier takes a lot of time and work at the beginning. It takes time to dig into the information, to learn all you can about their production capabilities, their partners (basically your competition), their competition; their reputation in the market and the reputation of their sales people and management; logistics and pricing, margin capabilities, service issues, quality issues, the company’s financial strengths and weaknesses, their product’s strengths, the marketing Read the rest of this entry »

The way to make the preparation process easy, intuitive and less monotonous is to split it in 3 clear defined steps. After you do that a few times and you include this in your negotiation routine, it will take (in the often case of a supplier you already work with) an unimportant amount of your time, sometimes up to 20 minutes.

However, as a general rule, take enough time to plan. This may be the most productive part of your negotiation actually. There is no pressure. If you are not negotiating alone, but in a team, prepare/delegate/split the preparation work with your team. If there is a new supplier, then the amount of work involved is obviously bigger. In case of your usual partners, you already know the information, just put it in writing. Don’t hurry, think in deep. This gives you the warranty that you leave at the hand of probability only very few variables.

When you have a new vendor in sight, the number of variables being much higher, documentation work takes a bit more time (also, the strategy and tactics adopted for the first meeting are specific).

Back to our 3 steps:

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I got one excellent feed-back on my previous post that I would like to share: there is another surprising reason why buyers are ignoring preparation. Unexpected or not, this is one of the most human possible causes – preparation seems so insipid compared with the “juicy” negotiation itself! Nobody wants to do boring stuff. So we skip this step or we do it mega quickly because we find the juice only in the game on negotiation. Well, trust me on that: you cannot have the good juice if you do not peel off and wash well your fruits before…

The most important thing about preparing a negotiation is, well, doing it!

Like any other professional with years of experience in negotiation, I learned my lessons during the thousands of hours spent with vendors or business partners. Negotiation is a skill: with good training, a good teacher, some key books and, above all, practice you may become a great negotiator. I noticed nevertheless that most of the books and tutorials are focused a lot on strategy and tactics and less on the first phase, preparation.

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