Purchasing Negotiation: The Art of Developing Strategic Partnerships

Negotiation is not an innate gift, but a skill that can be learned and constantly improved. The concept of “knowing how to negotiate” is also not exclusive to the business world – children are excellent negotiators, for example. They know the other party well (parents, grandparents, family members), know how to argue and are persistent.

The main difference is that, instead of using emotion, adults need to give voice to reason, without being cold or distant from the other party. Given the pressure that surrounds purchasing professionals in their daily activities, the “art of negotiating” requires, above all other skills, emotional balance and professionalism.

More than winning offers

In the purchasing area, negotiation with suppliers is extremely important, precisely because of the direct impact on cost reduction and profit generation. Therefore, the topic needs to be a priority on the agenda of managers and buyers, accompanied, of course, by other aspects that are essential for companies today, such as transparency, ethics and compliance.

Negotiation strategies need to be efficient, optimized, and have their risks reduced and opportunities maximized. If the purchasing department’s “negotiator role” has not been well performed by buyers or the issue is not perceived as relevant enough within the company, there is a good chance that the business is losing a lot of money.

For companies to achieve good results and remain competitive in the market, buyers need to invest in good negotiation practices with suppliers, especially in crisis scenarios and uncertainties. After all, every real saved on purchases returns a real in the company's profit. But a good negotiation is not limited to getting the best offer. Before closing a deal, it is necessary to evaluate other aspects, such as payment conditions, deadline and, mainly, product quality.

Planning

When it comes to corporate purchases, companies need to be aware of the risks. Before starting to negotiate, the buyer needs to be clear about what needs to be purchased, what the technical specifications are, the required deadline, the budget limit, among other aspects. One of the main mistakes is not being equipped with information when negotiating. With little or no preparation, the buyer may close a deal that does not benefit the company.

Structuring your purchasing strategy in advance is an excellent way to secure the best deals. For example, consider seasonality and negotiate with a supplier during the period when the partner usually has a lower sales volume. This will certainly be more flexible. Situations like this are only possible if there is proper planning and market research.

Relationship

Negotiation is not a dispute. The buyer needs to have an empathetic perspective when negotiating. This is where the supplier stops being a mere service provider and starts to be recognized as a true business partner, precisely because, most of the time, he is more interested in a relationship long-term than closing a single sale.

A “win-win” relationship means that both companies are strengthened by the negotiation. On the other hand, despite the strengthened relationship, it is essential to understand the advantages, for example, if the supplier seeks innovations, and always consider developing new partners. Bargaining power cannot be weakened over time.

Communication

How can you achieve good negotiations without communicating accurately and confidently? This is practically impossible. Knowing how to communicate is key to successful negotiations in purchases. Here, it is worth remembering a simple concept of the elements of communication between the sender and the receiver. Feedback, which is the receiver's response to the speaker's speech, is very important.

For this reason, in a negotiation, just as the buyer must express himself clearly and objectively, he must also be willing to listen to the supplier. During a negotiation, the buyer will be able to identify more business opportunities if he allows the supplier to present more details.

Technology speeds up the process

Shortening the purchasing cycle is one of the main challenges for companies. But, fortunately, digital solutions have increasingly made the tasks of buyers easier. With a Procure-to-Pay (P2P) platform, it is possible to perform a series of analyses and automate the negotiation process, thus facilitating more assertive and accurate decisions. achievement of savings.

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