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Quiz 12 :

Formal Negotiating

Quiz 12 :

Formal Negotiating

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"You are the worst possible person to have to negotiate for yourself. You care too much about the outcome. Always let someone else negotiate for you." State your reaction to this statement. What implications does it have in industrial sales negotiations?
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Formal negotiating stand for the process wherein the seller and the buyer has come to that point in a deal wherein they have to formally negotiate and final out the terms and conditions governing the contract and stating each party's obligation towards each other.
Mr. Y is worst choice for negotiating, he is always under a pressure constantly thinking about the outcome of the deal. This attitude and behavior demonstrated by Mr. Y are worth focusing and making a mark about because being too much focused at the outcome of the negotiation, makes the negotiator undergo a fear of losing and not being able to negotiate effectively. This creates an overall negotiation environment completely burnout and leaves no place for success and effectiveness.
This kind of negotiation behavior and attitude of Mr. Y also creates a major thrust over his capability for negotiating at industrial level sales negotiations. If this person is not capable to negotiate himself and always take help of others to undertake negotiation, then he is not going to be successful in industrial negotiations as well. He always be needing other's help while undertaking negotiation affecting the entire negotiation process as a whole.

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Suppose you're a salesperson with a local milk producer and you're negotiating with a regional grocer over the number of deliveries you will make to their stores in a given week. Your maximum is nine times a week, your opening is four times a week, and your target is six times a week. After negotiating for some time, the grocer states, "Look, we're not willing to accept anything less than 14 times a week." What do you do now?
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Formal negotiating stand for the process wherein the seller and the buyer has come to that point in a deal wherein they have to formally negotiate and final out the terms and conditions governing the contract and stating each party's obligation towards each other.
Mr. Y is a salesperson selling local milk products, and he negotiates with a regional grocer related to deliveries of several products that he has to make to his store several times a week. The maximum deliveries are nine times a week, and the opening is four times a week. But Mr. Y targets to have it six times a week. But the grocer asks that he is not going adjust anything less than 14 times a week.
In this situation, Mr. should take the grocer's statement and should try to make deliveries atleast 14 times a week. This is because the grocer works at regional level, and Mr. Y is a local salesperson and by grabbing this deal he could make its products available at regional level which could be a big growth for the products with increased sales and profits. Thus, by looking at the future profits, Mr. Y should agree to the grocer's demand for 14 times a week delivery.

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Based on the situations described in "From the Buyer's Seat 12.1," list three things salespeople should do to ensure successful negotiations.
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Negotiation refers to the bargaining process through which both buyers and sellers resolve areas of conflict and arrive at a agreement which serves as a win-win situation for both. It is necessary for any negotiation process to be successful that the sales person have good knowledge about their product, competitors product and what is the minimum level to which they can negotiate, the person should present his point well to the other party to arrive at a conclusion.
Some of the traits which the sales person should have involve creativity, it helps the negotiator to get the desired negotiation outcome from other party by providing creative solutions and alternatives, knowledge seller must have the complete knowledge about all their products features, benefits, costs and also that of competitor's, they should also know what alternatives are available for their product, so that if customer want to move to competitor they can represent facts for their point.

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This chapter described a number of basic conflict-handling modes that people use in negotiation. These include competing, collaborating, compromising, avoiding, and accommodating. Carefully reread the section that describes these modes. For each mode, identify someone you know who falls into the mode and answer the following questions. It will probably help to think of a specific situation that you have observed or have experienced with the person. Would you like to have this person on your team during an important negotiation session? Why or why not?
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"If your opponent begins to use an unethical tactic, walk out of the room." Comment on this statement.
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Assume you are going to have your fourth and final job interview with Fastenal, a distributor of fasteners and other construction-related materials, next Friday. Knowledgeable friends have told you that because you passed the first three interviews, you will be offered the job during the fourth interview. Also, you know that Fastenal likes to negotiate with its new hires. a. Think about your own needs and desires for your first job (such as salary, expense reimbursement, benefits, geographic location, and promotion cycle). b. For each need and desire listed, establish your target position, opening position, and minimum position. c. Fastenal has probably also developed positions that might meet each of your needs and desires. Describe how you could discover these positions before next Friday's meeting.
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This chapter described a number of basic conflict-handling modes that people use in negotiation. These include competing, collaborating, compromising, avoiding, and accommodating. Carefully reread the section that describes these modes. For each mode, identify someone you know who falls into the mode and answer the following questions. It will probably help to think of a specific situation that you have observed or have experienced with the person. How do you know this person has this conflict-handling mode? Identify specific behaviors that you have observed or heard about to support your assertion about this person.
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DoubleTree has more than 300 hotels in 23 different countries. The chain is owned by Hilton and strives to create what they term CARE (Create A Rewarding Experience) for all of their guests. The CARE system starts with a warm chocolate chip cookie to welcome each guest. That is followed with stylish guest rooms, each including the Sweet Dreams ® by DoubleTree Sleep Experience. Most guest rooms offer the higher-quality CITRON bath products by Crabtree Evelyn. Double- Tree also offers Fitness Rooms for their guests. Julie, a salesperson for Micros, was attempting to negotiate with DoubleTree with regard to Micros's OPERA Reservation System (ORS). ORS, a central reservation system, is a part of an enterprise-wide room inventory management system offered by Micros. ORS has many outstanding features, including the following: It supports multicurrency and multilanguage situations; it lets you set up rate structures for individual properties or groups of properties; it can easily handle complicated situations, such as shared reservations, frequent-flyer, and loyalty program memberships, negotiated rates, and rate discounts; and it conveniently searches for room availability across all of the properties. Julie met with the DoubleTree buyers on eight different occasions before the formal negotiation meeting. She had created a win-win proposal that she was sure would meet the needs of DoubleTree and Micros. Her boss had even congratulated her on her hard work and the proposed solution. "You're going to get it, I'm sure!" she had said. "And then we can start talking about that raise you've been asking for!" Everything was going great in the negotiation meeting until Julie was startled to hear Kevin Tarnoski, the key negotiator for DoubleTree, practically shout, "Listen, Julie! I can't believe you're asking that much for this little reservation system! The recession hit all of us in the hospitality industry very hard. Come to think of it, that's probably why you're trying to stick it to us with this price. Knock it off! Lower your price, or we'll go elsewhere!" He then proceeded to tell her how much he was willing to pay to lease her system. Julie didn't know what to say. The price cut being requested by Kevin was 5 percent less than Micros's minimum price objective. Evaluate the negotiation meeting to this point. How could Julie have better planned for the meeting? Sources: This is a fictitious scenario. Information about DoubleTree came from http://doubletree3.hilton.com/en/about/doubletree/index.html. Information about Micros came from http://www.micros.com/Solutions/ProductsNZ/OPERAReservationSystemORS.
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Stephanie Bolen, a salesperson for Nestlé, is preparing for an important negotiation session with Cub Foods, a large national food chain, regarding an upcoming promotional campaign. Her boss has strongly suggested that he attend the meeting with her. The problem is that her boss is not a good negotiator; he tends to get angry, is unorganized, and tries to resolve conflict by talking nonstop and thus wearing down the buyer team with fatigue. Her boss definitely has a win-lose negotiating philosophy. What should Stephanie do?
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According to the text, engaging in friendly conversation to break the ice before getting down to business is usually a good idea. When would it not be a good idea?
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"As a salesperson negotiator, my buyer's problem becomes my problem." Comment.
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Assume you're a salesperson who is known for your excellent negotiating skills. You're a true collaborator in every sense of the word. Today you're supposed to engage in a negotiation with an important client. It's taken three months to set up this meeting, and your team of five, including your vice president, is assembled and ready to walk into the meeting. You are your team's designated leader. Your cell phone rings, and it's a relative, telling you that a close loved one has passed away unexpectedly. With the news comes a desire to just quit everything. What do you do now?
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"Try to get a big concession from your opponent by giving away a small, insignificant concession yourself." Comment.
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During negotiation, buyers make all kinds of statements. What would be your response to the following, assuming each occurred early in the meeting? a. We refuse to pay more than $15,000 each. That's our bottom line-take it or leave it! b. Come on, you've got to do better than that! c. You know, we're going to have to get anything we decide here today approved by our international headquarters before we can sign any kind of a contract. d. One of our buyers can't make it here for another hour. But let's go ahead and get started and see what progress we can make. e. Tell you what, we need to see a detailed cost breakdown for each individual item in your proposal.
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DoubleTree has more than 300 hotels in 23 different countries. The chain is owned by Hilton and strives to create what they term CARE (Create A Rewarding Experience) for all of their guests. The CARE system starts with a warm chocolate chip cookie to welcome each guest. That is followed with stylish guest rooms, each including the Sweet Dreams ® by DoubleTree Sleep Experience. Most guest rooms offer the higher-quality CITRON bath products by Crabtree Evelyn. Double- Tree also offers Fitness Rooms for their guests. Julie, a salesperson for Micros, was attempting to negotiate with DoubleTree with regard to Micros's OPERA Reservation System (ORS). ORS, a central reservation system, is a part of an enterprise-wide room inventory management system offered by Micros. ORS has many outstanding features, including the following: It supports multicurrency and multilanguage situations; it lets you set up rate structures for individual properties or groups of properties; it can easily handle complicated situations, such as shared reservations, frequent-flyer, and loyalty program memberships, negotiated rates, and rate discounts; and it conveniently searches for room availability across all of the properties. Julie met with the DoubleTree buyers on eight different occasions before the formal negotiation meeting. She had created a win-win proposal that she was sure would meet the needs of DoubleTree and Micros. Her boss had even congratulated her on her hard work and the proposed solution. "You're going to get it, I'm sure!" she had said. "And then we can start talking about that raise you've been asking for!" Everything was going great in the negotiation meeting until Julie was startled to hear Kevin Tarnoski, the key negotiator for DoubleTree, practically shout, "Listen, Julie! I can't believe you're asking that much for this little reservation system! The recession hit all of us in the hospitality industry very hard. Come to think of it, that's probably why you're trying to stick it to us with this price. Knock it off! Lower your price, or we'll go elsewhere!" He then proceeded to tell her how much he was willing to pay to lease her system. Julie didn't know what to say. The price cut being requested by Kevin was 5 percent less than Micros's minimum price objective. What should Julie do now? Be explicit and give reasons for your answers. Make any necessary assumptions. Sources: This is a fictitious scenario. Information about DoubleTree came from http://doubletree3.hilton.com/en/about/doubletree/index.html. Information about Micros came from http://www.micros.com/Solutions/ProductsNZ/OPERAReservationSystemORS.
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In "Sales Technology 12.1," you learned how salespeople are using Skype to prepare for upcoming negotiation sessions. What are some potential problems with using this technology in this way?
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This chapter described a number of basic conflict-handling modes that people use in negotiation. These include competing, collaborating, compromising, avoiding, and accommodating. Carefully reread the section that describes these modes. For each mode, identify someone you know who falls into the mode and answer the following questions. It will probably help to think of a specific situation that you have observed or have experienced with the person. How do you (and others) interact with this person during a conflict situation? In other words, what do you do? How do you respond to this person's behavior? Is your approach effective?
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