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Top 10 Questions to ask at the beginning of a negotiation

2nd May 2017

Asking questions at the beginning of a negotiation can help unlock your objectives, variables and alignment and also those of your counterpart. This helps you to identify value.

Here are 10 questions to help you at the start of your negotiation.

1. How are you? A simple seemingly innocent question, but one that can let you know how your counterpart is feeling and what is happening in their life. Understanding your buyer’s personal needs will help you develop variables that meet their needs. Maybe they have had a bad week in their personal life which will affect their preparedness for negotiation. Perhaps they are feeling confident after winning greater share and will therefore be more assertive in the objectives in upcoming negotiations. At the very least, it will build more rapport with your counterpart.

2. How long have you worked in this role? A more experienced buyer will have a greater understanding of the suppliers and a greater understanding of the dynamics of the category. Consequently, they are likely to have more alternatives available and therefore a greater balance of power.

3. How is current trading? This will help you gauge the balance of power. A counterpart who is struggling with current trading may be more amenable to offers than those where business is booming and they have the luxury of picking and choosing deals from suppliers.

4. What is driving category value in your outlets? This will help you in developing a compelling customer proposition and also help in developing variables that are valuable and important to your counterpart.

5. What value share of your category are my brands? This will also help in assessing the balance of power. The more important your brands are to your customer’s category the more likely you are to have a greater degree of power in the relationship. Value share is generally a better guide to volume share as own-label products are sold at a discount to branded products, thus your brands should, in most instances, have a higher value share than volume share.

6. What levels of in-store compliance have you been able to adhere to? This will give an indication as to what you can expect in terms of out of stocks, facings, adherence to planograms and promotions. These levels of compliance will affect your variables, objectives and balance of power.

7. What alternatives have you looked at? See if they have any BATNAs. If they have little or few alternatives then you have more power and vice versa.

8. When are your busiest and quietest times of year? An amazing offer during a quiet time of year is unlikely to impact the category as much as a good offer during a busy time of year. Think about securing promotional slots and additional visibility during busy times of year. You may also want to consider when you start negotiations given this piece of information – do you want to start negotiations before or after their busiest time?

9. What are you looking for from our relationship? If they are looking for a one-off deal rather than an on-going relationship, this will affect the value you can offer.

10. What do you want to achieve from this deal? By understanding their objective you can understand if you can meet their objectives, perhaps without even conceding any terms. Be aware of pre-conditioning.

Even if you think you know the answers to these questions, it can help to ask the questions anyway. You may get answers you didn’t expect or more information to back up your initial thoughts. It may also help to influence your buyer on key messages. For example, by asking them about your share with them it will influence the buyer into realising just how powerful your brands actually are in their category.

Asking good questions is an art and one which you can develop with excellent kaleidoscopic preparation.

We’d love to hear from you if you have any suggestions on the topics to be discussed or if you would like to find out more about Total Negotiation services. Please don’t hesitate to contact Tanya Wilson – tanya.wilson@totalnegotiation.com 

 

 

 

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