Establish and maintain negotiation plans to use in completing a supplier agreement.
The acquirer develops and refines a negotiation plan for each of the candidate suppliers based on the evaluation of the suppliers and their proposals.
The proposal evaluation and negotiations with suppliers provide the basis for selecting the supplier best able to meet the requirements of the solicitation.
The size of a negotiation team depends on the size and complexity of the project. Typically, the team is led by acquirer management and includes individuals who have detailed knowledge of the statement of work documented in the solicitation package. The negotiation team is typically supported by a legal staff, a financial analyst, purchasing, and the project manager.
Negotiations between acquirers and suppliers can be restricted by regulation. Review all regulations affecting negotiations before entering into them with a supplier.
- Roles and responsibilities of negotiation team members
- Key issues to be negotiated from supplier responses
- Negotiation “levers” and where and when they should be used
- The sequence of events to negotiate issues
- Fall-back or compromise positions as necessary on given issues (possible concessions and trades)
- List of items that are non-negotiable
- External factors that could influence negotiations; (e.g., other pending deals and strategic plans)
- Prior experiences with supplier agreements to discover previous positions and issues (and negotiating styles)
- Schedule and sequence of supplier negotiation meetings
- Objectives for each negotiating session
- Risks, consequences, and mitigation alternatives
Example Work Products
- Negotiation plan for each candidate supplier