Class Negotiation 4

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Apr 3, 2024

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Isaac Castillo Professor Glenn Smith George Brown College MARK-2053 February 5, 2024 Class Negotiation 4 (Excalibur Engine Parts) 1. What goal did you set to be achieved in this negotiation? Your opening bid? Your bottom line? Before we started negotiating my goal was to achieve more than what was being offered by the government, which was set to be $600, still attempting to convince the buyer that what we are selling is of high quality and ensuring that competitors do not have the same advantage as us. My opening offer was $650 / piston and I set my bottom line as $400 / piston. 2. Did you have a “Best Alternative” or “Option” if a deal was not struck? How good was this option? How did it affect your negotiations? If the negotiation took a turn and I was left with my alternative options, I had the government willing to take the 10,000 pistons off my hands for $600 / piston and another buyer “Hank’s Super Monster Tractors Inc.” willing to take them for $100 / piston. With both options in mind, I would go with the government’s offer, in addition it did affect the play out of the way I wanted the negotiation to go, I either settle for more per piston or just even as to the government’s offer. Hence, me starting the opening bid to $650 / piston. 3. Did you reach an agreement in the negotiation? If yes, how satisfied were you with your agreement after you reached it? If not, were you convinced that it was a good idea not to agree? We did mutually reach an agreement in the negotiation; I was highly satisfied with the outcome of the negotiation since I got more than was anticipated from the other offer from the government. We settled on $630 / piston which was more than offered by the government and creates a greater profit margin for the business. 4. In addition to a price for the pistons, what were the other elements of the deal that you agreed to? Did these factors help to make the negotiation more or less competitive? There was two other elements of the deal which were incorporated in the deal that we made. I was able to get the buyer to get the insurance for the pistons and to pay the rush fee which was reduced from 5% to 3% instead, which was the only downside to the negotiation on my part. It did make the negotiation more competitive since there was multiple rebuttals from the other party about both insurance and rush fee, but in the end I did prevail getting them to pay for both.
5. What strategy and tactics did you use to help you achieve your objectives in this negotiation? Did your strategy and tactics “work”? My strategy was to highlight the key components about our product to the buyer, introduce the insurance and rush fee as part of the price in terms of each piston which would create that feeling of not having to pay more when in reality they are in fact paying more, and starting the bid off higher than usual to have some negotiating room. I also did take control of the negotiation by giving the other party a “take it or leave it” deal. Overall, using this strategy worked in my favour and got me the deal. 7. What strategy and tactics did the other party use? Did these tactics “work”? Why or why not? The other party was trying to negotiate by intimidating me to go to another seller, using the prices of other sellers to bring down what I was offering. He was able to bring down the rush fee percentage down simply by counter offering me which I gladly accepted , which were the only terms that were changed from my original offer. I would say his tactics did not work on me, I was pretty assertive with what I wanted to receive and I got it. 8. As a result of these negotiations, what is the current state of your relationship with the other negotiator? Would you be more or less likely to do business with this person in the future? Why? The state of the relationship seemed to be pretty stable, the other party did mention that they went above budget, which I did offer to give a better deal next time we do business together. I would simply go forward with doing business with this party simply because as observed they are easily persuaded and not very assertive when it comes to negotiating, which does bring benefits to my business. 9. What did you learn from this exercise that you will want to continue (or change) in future negotiations? I want to continue to be assertive during negotiations and listen to what the other party has in mind when it comes to offerings. I know that not everyone is the same and there will be individuals that will be more assertive and dominate within the negotiation process but overall I will be changing the way I present the benefits of the product/service that I am offering, I feel like I wasn’t to clear and I was stumbling a lot.
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