The 3 Stages of Face-to-Face Negotiation

In many cases where a reverse auction can be used, we recommend that you (the buyer) reserve what is known as buyer’s choice. This means that, although the outcome of the auction is important, it is not necessarily the only factor you will consider when awarding the business.

One option you have, that we see many of our clients do, is bring the top three suppliers in to further discuss the tender opportunity. But what do you do then?

We’ve put together a guide on Face-to-Face Negotiation Strategy to help assist you with this. This can also be applied should you choose not to run an auction and go straight to the face-to-face stage of negotiation.

A negotiation can be broken down into three main phases:

Preparation, Discussion & Review

Preparation

The preparation phase of a negotiation is where you:

• Assess relative positions
• Set objectives and negotiation margins
• Decide strategy and tactics

Discussion

The discussion phase consists of three elements:

1. Opening
This is where you declare your objectives and opening positions. This should obviously be a position from which you are prepared to move and thus should be a relatively high, yet sensible, list of demands.

2. Probing
Here you will gently probe each of the negotiation issues, gaining an overall understanding of the position, without making any commitments.

3. Bargaining
This is the critical point. At the end of this phase you will either have the makings of a final agreement or negotiations will breakdown.

Review

The review is where you will work out the next steps, which will either be obtaining a signed agreement or looking at alternative options. It is also a good time to understand what went well, what didn’t, and what could be done next time to improve.

Want to learn more about the full strategy behind face-to-face negotiations? Simply register (for free), then click the PDF icon below to begin the download. The guide itself was put together by the Market Dojo team, combining their 20+ years of procurement experience to bring you a true value-adding document to ramp up your negotiation skills.

Alternatively, download our eGuide The Ultimate Sourcing Starter Kit

//ARTICLE UPDATED: June 2023