Vendor Negotiation’s Post

����𝐞𝐠𝐨𝐭𝐢𝐚𝐭𝐞 𝐚 𝐂𝐨𝐧𝐭𝐫𝐚𝐜𝐭 When it comes to working with vendors, building a positive and productive relationship is 🔑. One way to do this is by crafting a solid contract that takes into account both parties' business objectives. But hold up – before you start haggling over 💰, remember that balance is 🔑. Negotiating is important, but not at the expense of quality. So, to make sure everyone's happy, it's crucial to create a contract that benefits everyone involved. #negotiate #vendormanagementsystem #contractnegotiations #vms #businessobjectives #balance #quality #negotiation #contract #relationships #vendormanagement #system Gazal Papriwal Naman Narayan Pallavi Patil Priyanka Goyal Favaz P A Gururaj Bharath Sura Shruti Raju Aakash Yadgiri Suyog Ubhare Mohan patro

Today's contract tip is to estimate your vendor's profit margin before you start negotiating the deal. As a newer lawyer, I had no idea that the vendor's profit margin should play into how I negotiate. I thought our goal for negotiations was to shift as much risk and pay as little to the vendor as we can. What I learned over time was that this kind of attitude is short-sighted for our clients. It can do more harm than good. When I work on the customer side, I often ask ask my client or team about the actual or estimated profit margin that the vendor has on the sale. Here's why figuring out your vendor's profit margin is critical: 1. Gauge how to allocate risk Every business contract has some risk. We allocate that risk in a way that makes this contract make sense for both parties. When a vendor is making a 3% margin as a sale, it makes sense that the vendor cannot accept significant liability and risk. But a vendor making a 50% margin on a large transaction has room to take on more risk and still make money. 2. Keep your vendor in the business You don't want your deal to put your vendors out of business. The smartest customers work hard to create a working relationship that preserves a reasonable profit for the vendor. What other ways does a vendor's profit margin factor into your negotiations? #HowToContract #SupplyChain #Procurement

Here's one little hack all shud use while negotiating all business contracts... So, most of my dealings in agreement negotiation are with respect to Client Agreements, Project Agreements, Negotiations and Key Vendor contracts — mostly in and around... I’ve learnt that before you get on a call to thrash out clauses with the counter party, classify all your points into 3 heads: Hard Push, Soft Push, and Leverage ➡️ Hard Push: Non-negotiables, which if not corrected to your favour, you will not go ahead with the deal. ➡️ Soft Push: You can live with these clauses, but you want to make an attempt at negotiating them to see if these can also be changed to your favour ➡️ Leverage: This is the real kicker. These are actually clauses that form part of the Soft Push, but you position them like Hard Push. This barely makes a difference to you, but you still fight it out... only to later tell the counter party... okay, I'll give up on asking for this if you also give up on another clause which actually forms part of your Hard Push. It's pure negotiating leverage 👍🚀♾️

Negotiating Works, but... ...it might take longer than you think. We've been negotiating for decades. During that time, we've negotiated with hundreds of vendors across countless industries. The results have saved our clients nearly $1 billion. How? First, we understand the market. That's a separate conversation. Equally important is continuing the dialog. When our clients (rightfully) may have years of paying too much to their vendors, it might take seven or more actual negotiation dialogs to get the results they deserve. The first negotiation dialog may get zero results. The next might get 20% of what the client wants. After multiple dialogs, the results are much closer to 100% of their demands. Here's a brief insight into the process... #NegotiationSkills #NegotiationProcess #CostSavings #ProcurementExcellence

Negotiating Works, but... ...it might take longer than you think. We've been negotiating for decades. During that time, we've negotiated with hundreds of vendors across countless industries. The results have saved our clients nearly $1 billion. How? First, we understand the market. That's a separate conversation. Equally important is continuing the dialog. When our clients may have years of paying too much to their vendors, it might take seven or more actual negotiation dialogs to get the results they deserve. The first negotiation dialog may get zero results. The next might get 20% of what the client wants. After multiple dialogs, the results are much closer to 100% of their demands. Here's a brief insight into the process... #NegotiationSkills #NegotiationProcess #CostSavings #ProcurementExcellence

A well-negotiated contract is like a seatbelt. You don't need it every day. But when you do... It can save your life. You might not think much of contracts, but they can make or break a business. How? - They protect you from unscrupulous vendors - They set clear expectations with your suppliers - They help ensure you get what you paid for If you've been neglecting contract negotiations, it's time to change that. Here are some tips: - Know what you want before negotiations begin - Do your homework on the other party - Be willing to walk away - Use a win-win approach - Get everything in writing Remember, the devil is in the details. Make sure your contracts are locked and loaded with all the necessary details to keep your business safe and secure.

Negotiating with a vendor who holds the upper hand can be a challenging feat. However, it's not impossible. Here are some strategies to level the playing field and secure a favorable deal: 1- Leverage Information: Research extensively. The more you know about the vendor and their situation, the better you can negotiate. 2- Emphasize Value: Highlight the unique value your partnership brings. Showcase how it aligns with the vendor's goals. 3- Patience and Timing: Be patient and pick the right moment. Timing can often sway negotiations in your favor. 4- Negotiate More Than Price: Consider non-price factors like delivery terms, service quality, or long-term benefits. 5- Build Relationships: Strong relationships can lead to more flexible terms. Invest in building rapport. 6- Walk-Away Point: Define your limits and be prepared to walk away if the deal doesn't align with your objectives. Remember, negotiation is an art, and being well-prepared is your greatest advantage. How do you navigate negotiations when the vendor has the upper hand? Share your insights in the comments! #NegotiationStrategies #VendorNegotiation #BusinessNegotiations #LinkedInCommunity #ProfessionalGrowth"

Gain valuable insights on negotiating contracts in vendor management and learn how to navigate the process smoothly. From strategy to execution, our latest post offers practical tips to help you get the most out of your business relationships.💼 https://lnkd.in/dJgsmqNv #VendorManagement #NegotiationTips #ContractNegotiation #BusinessStrategy

When someone says: "She's a good negotiator” Here's what they really mean: - "She sets a clear agenda" - “She sets appropriate expectations” - “She gets full stakeholder buy-in” - “She aligns a vision for the future” - "She talks through potential obstacles” - "She asks all the right questions" - “She listens to understand” - "She remains calm and measured” - "She keeps the deal moving forward" - “She executes to implementation” "Negotiating" isn't one single thing. It's an aggregation of many things done extremely well. ——— Before I was in Procurement I spent 10+ years in various Buying roles. I developed my VPN method which has served me brilliantly in every negotiation since. In brief: V = Vision Most common ground is found some time away in the future. Align on that long-term vision, work back from that and both parties will be determined to make it work. P = Principles Align the principles before you dive into the numbers. What are the three big things both parties need to achieve from the deal? Agree they are reasonable (challenge or seek to understand any that are not). Lay the foundations for agreement before you build any proposal. N = Numbers. I’m not talking the actual figures/ $values yet. But apples for apples alignment on the numbers that will be important for both sides. - length of term - current volumes - reporting metrics - predicted volumes Once you have a VPN in place, negotiating the actual deal will be painless. I promise. Negotiation is not one single thing. It’s the aggregation of many things done extremely well. ———— P.S. 5800+ Procurement and Sales legends got my VPN method broken down in the article I released 20th Nov 2023 + a checklist to use anytime. Join them here to access it in the archives, it’s free to subscribe: https://lnkd.in/eXWjbkFS

In the grand tale of vendor agreements, I, as a Contact Specialist, embark on a daily journey, navigating the complex and challenging paths of contract negotiation. “𝑭𝒊𝒓𝒔𝒕, 𝒔𝒆𝒆𝒌 𝒕𝒐 𝒖𝒏𝒅𝒆𝒓𝒔𝒕𝒂𝒏𝒅, 𝒕𝒉𝒆𝒏 𝒕𝒐 𝒃𝒆 𝒖𝒏𝒅𝒆𝒓𝒔𝒕𝒐𝒐𝒅,” Stephen Covey’s wise words guide my initial steps. I begin by thoroughly understanding the needs of both our company and the vendor. This foundational step ensures clear expectations and mutual goals. Next, like Chanakya, I meticulously review every clause, leaving no stone unturned. “𝑻𝒉𝒆 𝒅𝒆𝒗𝒊𝒍 𝒊𝒔 𝒊𝒏 𝒕𝒉𝒆 𝒅𝒆𝒕𝒂𝒊𝒍𝒔,” they say, and I ensure compliance, legal adherence, and risk mitigation. Communication is my Brahmastra, opening channels of transparency and trust. In negotiations, I strive for win-win outcomes, believing in “𝑻𝒉𝒆 𝒐𝒏𝒍𝒚 𝒘𝒂𝒚 𝒕𝒐 𝒈𝒆𝒕 𝒕𝒉𝒆 𝒃𝒆𝒔𝒕 𝒐𝒇 𝒂𝒏 𝒂𝒓𝒈𝒖𝒎𝒆𝒏𝒕 𝒊𝒔 𝒕𝒐 𝒂𝒗𝒐𝒊𝒅 𝒊𝒕.” Tackling vendor agreements is a challenging yet rewarding quest, fostering strong, collaborative relationships and safeguarding our interests. How do you approach vendor agreements in your role? Share your tips and experiences in the comments below! #VendorManagement #ContractSpecialist #NegotiationSkills #ProfessionalGrowth #CareerDevelopment