Negotiation Skills for Purchasers

Course Introduction

The price is the most common issue negotiated between buyer and seller. But according to salespeople, buyers generally do little more than just say the seller’s price is too high and must be reduced – a strategy sellers are very prepared to deal with. Buyers must level up their negotiation skills by being able to sell the supplier on why the seller’s price is too high.
This is the strategy used by procurement personnel with advanced skills to bring significant savings to their organization. This workshop is designed to provide advanced techniques and tools to create expert negotiators who bring high confidence and abilities to price negotiations with suppliers and contractors for goods, equipment, and services.

•  This is an intensive negotiation program and it is suitable for Managers, Executive and Officers in the area of purchasing, materials management, operations, engineering, marketing, finance and customer support who are stakeholders in the Purchasing process.

• The criticality of preparation and planning in successful price negotiations
• Advanced negotiation skills set
• Methods in preparing to negotiate price
• About cost drivers and market changes that can reduce price
• Total Cost of Ownership Concepts
• Combining Price Negotiations with other important issues
• How to work with Cost Estimating Relationships?
• The elements of cost that make up the price
• Defining the Negotiation Objectives
• Establishing initial positions

This is a highly interactive training programme, whereby participants are to gain the learning points through roll-play, lecture, case studies and experiential activities.

First Things First –Negotiations Starting Points
• Why are we here?
• Advanced negotiation skill sets
• Just asking for a better price
• What to negotiate?
• The ABC analysis – Are we an A, B, or C customer?

Issues to Consider Before Negotiating Prices with Suppliers
• When does the negotiation start?
• The most important thing to remember in negotiations
• The History of past negotiations
• Understanding the suppliers cost structure

Using Cost Drivers, Indexes & Cost Estimation in Negotiation
• Determining the major cost drivers
• Understanding market indexes
• Developing cost estimating relationships

Three Advanced Methods in Negotiating Prices with Suppliers
• Developing the “should cost” to use in the negotiation.
• Steps in Resisting price increases
• Defining other issues that can be used to negotiate price

Negotiations Planning & Strategies
• Determining initial positions
• Negotiation objectives diagram
• Negotiations planning forms
• Final preparation
• Determine strategies

Negotiation Power Closes
• Power Closes that are used on the Buyer

Negotiation Tactics
• Negotiation Tactics and Countermeasure

Negotiation Review & Analysis
• Post review and analysis